What do the interest rate increases mean to your investments? Interest rate increases will affect different investments in different ways.
Investment
Apply a long-term view on your investments in times of uncertainty
Headlining at the moment are Russia’s invasion of Ukraine, house prices and rising interest rates, dropping share values and so on. Naturally, many people I speak to are worrying about all of this as well as how it might be impacting their own nest eggs and investments.
Super phase vs pension phase and how it impacts your retirement
What you’re essentially doing before retirement in your “super phase” is having your employer contribute your superannuation, possibly top it up yourself with a sweet tax benefit, then letting time and compound interest do their thing. Then, once you are eligible to access your super, you switch it up to “pension phase” and access your money tax free.
Beware the COVID Bubble
The most pertinent thing to do right now is to consider your existing risk profile. Consider the issues and unknowns, revisit your goals and objectives, reflect on your investment timeframe and weigh up some best/worst case scenarios. Then position yourself in case a storm comes through.
Risky business
When investing it can be OK to ride a skateboard down a steep slope. But if you’re going to do it, it’s good to fully appreciate the risks and it’s probably best to avoid it as you get closer to retirement!