Saving for the deposit on a new car or next year's holiday is different from investing to achieve a long-term goal, such as building up a retirement pot or paying school fees. Saving generally involves putting money into a bank or a bond that is relatively safe and pays a fixed, although typically low rate of interest. However, a savings plan may not earn you wealth enhancing returns over the long term and taking into account the impact of inflation the real purchasing power of your money will likely decline. Investing, on the other hand, can help you to both create and preserve your wealth. By taking an appropriate level of risk you may have the opportunity to earn potentially higher long-term returns. It is important to remember that the value of investments, and the income from them, may fall or rise and investors may get back less than they invested.

Becoming a successful investor requires both planning and discipline.

Planning means thinking carefully about everything you need to consider when developing your investment plan, including:

Discipline means keeping market movements into perspective, recognising the potential impact of risk and regularly rebalancing your portfolio. It is also important to live within your means and decide how much you will set aside for investing before you start to develop your plan.

Work out what you want to achieve from your investments and define your investment time frame.

Your investment time frame provides a framework for deciding which investments to choose. People have different goals at different stages of their lives. For example, if you are retired, you may simply want to maximise the amount of income you receive. Whereas, your longer term focus might be building financial security for you and your family. Whatever your goals and your time frame for investing, it is important to be realistic about what you can afford to invest and how best to manage your investments. If you are unsure of what type of investments may suit you, you might find it helpful to seek the advice of a qualified financial advisor.

The old saying 'time is money' sums up precisely why it's so important to invest for the long term.

Your financial goals may include launching a business, leaving a legacy for your heirs. Whatever they may be, one of the best ways for you to reach them is to invest over a long period of time. That’s because the effects of compounding the returns you receive from your investments over time can be significant. In fact, compounding is the engine that powers long-term investment returns.