UIBFS | The Uganda Institute of Banking and Financials Services | Financial Awareness Month 2022 (Season Three)

Investment Tips

Get started with your investment plan.
It is always good to invest some of your money.  To learn more, read widely and talk to financial institutions or investment companies or individuals who are already investing, or get further information from the CMA, USE, Uganda Investment Authority, PSFU.

Invest to employ yourself
You can invest your money in activities such as poultry farming, growing vegetables, running your own grocery shop or building apartments for rent.

Use your own funds or your group’s funds for investing
You can use parts of your personal savings to start an investment. Alternatively, you can pool resources as a group – this is common with friends and peers.

Every investment comes with a risk…
There is a risk of losing money when your investments lose value, are stolen, mismanaged, destroyed or damaged. If you are investing through a bank or you use an investment advisor, find out from them how to best minimize the risk of loss. Some investments such as government securities, bonds and treasury bills usually have very little risks.

Invest according to how much risk you are willing to take
Riskier investments may earn you higher profits if they are successful – but there is a greater chance that you can lose some or all of your money.

Don’t put all your eggs in one basket
Invest in different projects in order to spread the risk or earn from different investment opportunities: “Don’t put all your eggs in one basket” because if the basket breaks you could lose everything. It is a good idea to balance high and low-risk investments or savings.

Get professional advice on large investments
If you have large amounts to invest, seek advice from an investment expert. You could contact the Capital Markets Authority (CMA) for a list of licensed professional investment advisors, or talk to a colleague who has been successful in business for advice. Most financial institutions also have financial advisors you can consult. Try to get various opinions and also trust your own informed judgement.

When you buy, think about selling
Some types of investments may be difficult to sell quickly – or difficult to sell at all. Before deciding whether to buy an investment, seek information on how easy or difficult it will be to sell it at a later time.

Understand the fees you will pay
Companies and individuals who buy, sell or manage shares or bonds on your behalf will charge you fees. These will reduce the profits you will earn. Make sure you understand the fees you will pay before deciding whether to buy shares or bonds.

Have a SMART goal
Having a Specific, Measureable, Attainable, Realistic and Time-bound (SMART) goal is the key to a financial breakthrough. Ensure that you keep an eye on your investments to see how they are performing. Do they still meet your goals?

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