Financial Channel

Hi!

I am hoping to start a regular saving pattern as a New Year resolution (which i intend sticking to!).
I hope to save / invest 1,000 a month.

Instead of a regular saver bank account which would give me an annual yield of approx. 7 % at the moment (First Active etc.), I am thinking of investing in a Rabodirect Fund.

However this is where I need some guidance from some of you good folk willing to advise.

Should I invest each month in what they call their 'fund of the month' which has reduced entry rates and would give me a mixed bag of investment funds
or, should I opt for a 'Regular Investor Plan' as advertised on their website.

Any advice would begratefully appreciated.

Cormac

Research the funds that *you* want to invest in because *you* think they are solid with potential for growth. Don't invest in a fund simply to save 0.5 percentage points on an entry fee - just because Rabo highlight it as their FOTM does not mean it is their best fund! :) Spend a bit of time researching the various markets e.g. China, EU, US, Commodities etc.

The Regular Investor option is just a fancy name for a standing order - you could just buy the funds on a one-off basis every month yourself and this would give you the flexibility to miss a month whenever you needed to. Unless you would prefer the discipline of the Regular Investor set-up, you might be better of fjust buying units when you want to rather than at the same time every month.

Buying at a fixed time every month can also mean you buy at the wrong time - be flexible

would give me a mixed bag of investment funds
I don't know what if you are saying that as if it is a bad thing? A a mixed bag is what you probably want to minimize your expose to any one fund.

Anyhoo, personally I don't see what the advantage of the Rabo Regular Investor Plan other than the fact that it is done automatically for you. Given the sum of money involved I think you should take the time to figure out where to invest each month.

Buying at a fixed time every month can also mean you buy at the wrong time - be flexible

Think about what you've just said. Buying at a fixed time every month decreases the chances you'll invest at the top (or bottom) thus decreasing your risk of the latter. It's a good idea in my book.