Young Investors

They're young and cashed-up with the world at their feet. When twenty-three-year-old engineer Ashley Ellis saved enough money for a house deposit, he realised he didn't want to be tied to a mortgage.

Ashley pooled his money into a managed fund, where professional investors trade in local and overseas stock markets on his behalf.

And if he does decide to take that long holiday... or move overseas... Ashley can pull out all his money within a fortnight.

"While they need to save and invest for the future, they also need to allow for the flexibility that their plans may change, and change substantially." Patrick Canion is a financial advisor with Ipac and says more young people are moving away from bricks and mortar and into more flexible investment options like shares and managed funds. "With just a few thousand dollars you can get professional management and expertise, and not just invest in one asset or one property in one street, but in fact across companies and office buildings around the world."

"Not every time is the perfect time to invest in shares or property." But finance expert Nick Bruining urges caution, and thinks for now, your savings are best left in the bank. "The real money's made when you buy in gloom and sell in boom. At the moment we're kind of in a bit of a boom situation, and that's why some of the experts are saying back-off, keep your money in the bank."

Patrick says "One of the greatest assets a young person has is the amount of money that they are going to earn in their working life. It's an incredible sum of money, so it makes sense that they should give some consideration to how they can make that work now to give them a better future."

So here are Patrick's top tips for young investors:

Firstly, think about how long you want to invest your money. "Are you going to need it for an overseas trip in three months? Or is it something you can put away for five years."

Consider your upfront entry costs, "What is the stamp-duty or upfront entry costs? For any investment you might be looking at. Compare them across the different ones."

Think about how expensive and time-consuming it will be to manage your investments and what's your exit plan?

"Every good investment you should understand what's involved and how long it will take to exit the investment."

And finally: - invest in yourself. "Invest in you proprietary limited. Whether that's through better education or improving your health - because by doing that you increase your future earning power, and that's an alternative that sometimes people don't consider."