Uitgelogd

U bent succesvol uitgelogd.

How much can I afford and do I want to invest?

Step 5

Investing is something you do with money you can spare. But how do you know exactly how much that is? It all starts by working out how much money you have left over at the end of every month. It’s also important to maintain a savings buffer. Do you still have enough money set aside for unforeseen expenses? In step 5, we’ll look at your income, expenses and savings buffer. Investing involves risk. You could lose all or part of your initial investment.

ABN AMRO
Target

Step 4. How do I set my strategy?

ABN AMRO

Back to the overview

ABN AMRO

Step 6. How can I invest with ABN AMRO?

ABN AMRO

What is your budget?

We cannot emphasise it enough: invest only money you can spare. Subtract your expenses from your income to calculate how much leftover income you have at the end of the month. A handy tool to use for this calculation is the personal budget advice service offered by Nibud, the Dutch National Institute for Family Finance Information. If you currently have little or no leftover income, investing is not a good idea or probably not right for you.

ABN AMRO

Calculate your monthly income

First write down your and possibly your partner’s income. This should include income such as:

  • Net salary
  • Benefits
  • Monthly allowances

There may also be income your receive on an annual basis (holiday pay/tax refund) or a quarterly basis (child benefits). To get the full picture of your income, you could convert the total sum into a monthly amount.

ABN AMRO

What are your monthly outgoings?

How much do you spend every month? Most of your spend will probably go towards ‘fixed expenses’ such as the rent or mortgage, energy and water bills, insurance, child care, and your mobile, TV, and broadband plan. Remember to also include what you spend on a car and your daily commute. Next, work out how much you spend in total every month on things such as groceries, clothes, going out and subscriptions to see what other costs you have every month.

ABN AMRO

All your costs at a glance in the app

Did you know that the ABN AMRO app includes a feature that lets you track your expenses? It can, for example, generate a list of all your subscriptions and fixed expenses. And it even lets you cancel any unused subscriptions immediately. On top of that, the app helps you anticipate expenses coming up in months to come.

ABN AMRO

Sufficient leftover income?

Have money left over at the end of every month? Great! The final step now is to check whether your savings buffer is enough to cover unexpected expenses, such as when your washing machine breaks down or your car needs costly repairs. The buffer calculator offered by Nibud, the Dutch National Institute for Family Finance Information, lets you work out just how much you need to have in your ‘buffer pot’. Still have money left over after filling your buffer pot? Fantastic! You’re all set to start investing. You can start investing from as little as € 20 and then you can make deposits into your investment account. But you should first set your strategy.

You are now ready to figure out your strategy

In step 4, you read about figuring out a strategy. Now you know how much money you have available to invest, we can complete your strategy. The following questions will help you formulate a strategy.

  • What is my investment goal?
  • How long do I intend to invest for?
  • How much am I going to invest (starting amount / monthly amount)?
  • What investment option will I choose?
  • How much risk am I willing to take?
  • If I want to make my own investment decisions, how do I intend to spread my risk?

 

Tip: write down the rules you’ve set for yourself and hang them in a prominent place.

On to the next step

Have you written down the rules of your strategy? Well done! In step 6, we’ll explore the different options for investing with ABN AMRO. Which investing option suits you best?

Investing involves risks

Investing involves risks. You could lose (some of) the money you invested. If you are going to invest, it is important that you are aware of this. Invest with money you can spare. Read more about the risks associated with investments.