Saving for a rainy day

Do money better with InvestSMART

Saving for your emergency fund

Spend less than you earn is the first money principle. The second is build a rainy day fund. Don’t risk dipping into your investments when life throws unexpected costs your way.

Saving isn’t as much fun as spending regardless of age. But the great thing about personal savings is that it gives you choices around what to do with your money to live the life you want to lead.

Paul Clitheroe AM, Chairman

Financial wellbeing matters

People who have a budget and savings tend to be happier*. Disciplined saving is a powerful behaviour to nurture and an excellent habit for when you do start to invest.

*Improving the Financial Wellbeing of Australians

How much?

Between 3 – 6 months living expenses saved in your rainy day fund is the general advice. This means you won’t need to borrow money or dip into your investments.
Goal set and automate

The best goals are achievable and specific. Set up an automatic transfer from your bank account to your savings account each payday. This is a great habit for when you start investing.
Save first, then invest

Dipping into your investments could result in you unnecessarily paying capital gains tax and potentially missing out on future earnings when you sell.

A budget and a bucket?

There are many ways to manage your money, you just need to find one that works for you.

Budget

A budget will help you meet your financial commitments and enjoy life more. A clear idea of your living expenses and how much you can save and spend are the first steps in your journey towards investing.
Bucket theory

Most banks allow multiple accounts (ie buckets). One for bills, food, fun, saving and investing etc. Each payday you send a predetermined amount to the buckets and live within those means.

Ready to start investing? Here are some options:

You’ve saved your rainy day fund and you’ve got money to invest. This is where you can get started:

Bootcamp

Build your investing confidence with our beginner investors course. You’ll learn investing fundamentals and how to form better money habits.
Learn more
Fundlater

Fundlater lets you invest in a $10,000 portfolio with $4,000. We’ll loan you $6,000 (no margin calls) and you pay us back over 20 months.
Find out more
Professional managed portfolios

InvestSMART’s range of investment portfolios selection from conservative growth to high growth. We have a portfolio to suit your goals.
Learn more

Start Investing

Wealth creation calculator

Do you have a savings or investment goal? Play with our calculator to discover how much and how often you need to invest to reach your target number.

InvestSMART portfolio planner

Interested in investing? We can help.

Simply tell us how long you plan to invest, your goals, savings and other investments. We’ll recommend a suitable investment portfolio for you.

Set financial goal

Portfolio HealthCheck

Get investment plan

Get Started

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Having financial goals is an important step to achieving long-term wealth. We look at how to set up these goals, and why saving can help us achieve them.

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Trusted by thousands of Australians

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Ray

“Very easy to get started and the dashboard is great to see which ETFs my money is invested in. Fees are also very cheap compared to other investment funds.”

Saving for a rainy day FAQs

Do you have more questions about saving or do you think you're ready to invest? Our FAQs can help or use the chat function to chat to a customer expert.

What portfolio should I invest in?

Choosing the right portfolio depends on your investment goals, time frame, and risk tolerance. To help you decide, consider the following:

1. Investment Time Frame: Each portfolio has a suggested time frame. Ensure it aligns with your financial goals:

2. Target Market Determination (TMD): Review the PMA Target Market Determination to understand the intended investor profile for each portfolio.

3. Tools & eBook Guides: InvestSMART provides several resources to help you choose the right portfolio.

Here is a list of tools and guides to help select the right portfolio:

InvestSMART's Statement of Advice – A tailored Investment Plan with step-by-step guidance.
Guide to Growing Wealth – Strategies to build your portfolio.
Guide to Investing in Retirement – Insights for managing your investments during retirement.
Investor Pack – A comprehensive overview of InvestSMART’s offerings.

Calculators:

For a deeper dive into investing, explore InvestSMART Bootcamp, a complete investment course designed to help you get started.

What is a Professionally Managed Account?

The InvestSMART Professionally Managed Account (PMA) is established and offered within the registered managed investment scheme known as the Professionally Managed Accounts.

Each investor has a separate account to which their investments are allocated. You will require a different PMA for each investment entity you have e.g. individual, joint, SMSF etc.

A client will open an InvestSMART PMA and can then choose between the various InvestSMART Diversified Portfolios. An account can hold one or more models but can only hold one diversified portfolio. The management fee is charged at the account level, not per portfolio.

Once you decide which model portfolio(s) are best suited to your investment needs and objectives, we will purchase the investment to be included in your account to reflect the model portfolio or combination of model portfolios that you have selected.

What does InvestSMART invest in?

When you open an InvestSMART Professionally Managed Account (PMA), you choose from InvestSMART's range of Diversified Portfolios to invest in.

A list of the portfolios can be found here.

These managed portfolios comprise of Exchange Traded Funds (ETFs) or, in some cases direct shares. In particular, the InvestSMART Hybrid Income Portfolio invests in Australian listed hybrids and listed debt securities.

What is an Exchange Traded Fund?

An Exchange Traded Fund, or ETF, is a managed fund that trades on the stock market.

There are different types of ETFs, each with its own purpose, but most commonly, they will track or follow a particular index.

For example, if you want to follow or track the S&P ASX 200 (the top 200 Australian shares by market capitalisation), you could either buy each individual share (200 shares) or one ETF. The one ETF wraps up the 200 shares into one holding. By holding this one ETF, you get exposure to the movements of the ASX 200, less any fees.

Investing in ETFs is a form of passive investing, and they generally incur cheaper management fees, as fewer investment decisions are required to manage an ETF. They are also quite liquid and traded easily on an exchange.

You can see the holdings of each InvestSMART managed portfolio by navigating to its product page and scrolling to Key Facts > Holdings.

Do I own the shares/ETFs?

Yes, all investments held within your InvestSMART PMA are held in your name (or chosen entity e.g. SMSF) in a CHESS sponsored broking account.

You are the registered legal and beneficial owner of a portfolio of securities. You can log into the investor website at any time to view the individual securities that make up your Account.

Is now the right time to invest?

This is the most common question we get from experienced and inexperienced investors alike.

No matter when you are looking to invest, there will always be something in the news that will have you asking this question. Whether it is a commentary on our local housing market, geopolitical uncertainty, or fears of a global pandemic. Uncertainty is constant, yet history shows us investment markets and asset classes continue to grow over the long term.

Having an investment plan and sticking to it is far more important than picking the exact day or week to invest. Developing good investment habits by investing for the long-term, in the right mix of asset classes, adding to your investment over time and rebalancing in a systematic fashion will see you reach your goal. In addition, chopping and changing your portfolio will chew up returns with transactions costs and potentially reduce your invested capital by paying additional taxes.

InvestSMART can help you select and stick to a plan:

Provides simple contribution and income reinvestment options
Transparent online monitoring through your 'My Account'
Consolidated annual tax reporting direct to your inbox
CHESS sponsored ownership of your portfolio holdings
Our famous low fees starting at just under $1 a week, capped* at $880 per year. See more on Fees here.

Is there a minimum balance?

The current minimum investment amount for the InvestSMART Professionally Managed Account (PMA) starts at $10,000 per model portfolio; unless otherwise stated in the Investment Menu, Key Facts section of the online information page or the Key Details section of the Investor Pack.

If you already have an InvestSMART PMA and just wish to add to your existing investment model, you do not require another $10,000 to contribute to that same investment.

Example: In your InvestSMART PMA you have $15,000 in the InvestSMART Conservative Portfolio and $11,000 in the InvestSMART Interest Income Portfolio.

You wish to withdraw $6,000 from the total portfolio.

Each portfolio requires a $10,000 minimum balance, so $5,000 would be withdrawn from the InvestSMART Conservative Portfolio and $1,000 from the InvestSMART Interest Income Portfolio.

How much should I contribute?

We can't tell you how much to contribute as we can provide general financial product advice only about the products that InvestSMART offers.

We cannot provide any personal financial advice and you should consider your own financial objectives, financial situation and needs before making an investment decision and submitting an application.

We have a number of tools you can use at InvestSMART including the Portfolio Manager and online calculators.

These links will take you to our various calculators:

Self Managed Super Fund (SMSF)

If you have a Self Managed Super Fund (SMSF), you can apply for an InvestSMART PMA.

We offer two types of SMSF accounts depending on how your SMSF is structured. If you're unsure how your SMSF is structured, it's best to contact your tax or financial advisor. Alternatively, you can email a copy of the SMSF Trust Deed to invest@investsmart.com.au.

^{Above: Account choice shown during application}

SMSF Individual

You have two to four individuals listed as trustees of the SMSF

SMSF Corporate

a company, such as a Pty Ltd, is listed as the trustee
the company will have one or more directors

InvestSMART will require different details depending on the structure of your SMSF, so please see the relevant option below to see the correct requirements for you.

What do I need to apply for my SMSF (Individual Trustees)?

For each individual listed as a trustee, we'll need:

Full Name
Date of Birth
Residential Address
Phone Number (Landline/Mobile)
Email Address
One Additional Source of Identification (License/Medicare/Passport)

To verify the SMSF as an entity, we need:

Superannuation Fund Name
The SMSF's Australian Business Number (ABN)
The Superannuation Fund's Bank Account
- BSB & Account Number

What do I need to apply for my SMSF (Corporate Trustee)?

For each individual(s) listed as director(s) of the corporate entity acting as the trustee for the SMSF, we'll need:

Full Name
Date of Birth
Residential Address
Phone Number (Landline/Mobile)
Email Address
One Additional Source of Identification (License/Medicare/Passport)

To verify the SMSF as an entity, we need:

Superannuation Fund Name
The SMSF's Australian Business Number (ABN)
The Superannuation Fund's Bank Account
- BSB & Account Number

We will also require the following details to verify the corporate trustee as an entity.

The name of the company that is the trustee of the SMSF
Australian Company Number (ACN)
Principal Place of Business Address
Registered Office Address

Like all account types, you'll be asked to specify:

an initial Investment Amount
the Investment Model(s)
the Investment Allocation(s)
any Income Preference
a Regular Contribution Plan
a Regular Withdrawal Plan

Tiered fee explainer

Our capped management fees are tiered depending on your investment amount.

Fees matter and have a significant impact on your net investment returns. We have a fee structure of 0.44% p.a. capped at $880 per year no matter how much you invest*.

Account balance tiers	Investment management fees p.a.
$0 to $200,000	0.44%
More than $200,000	$880

See the interactive slider here: https://www.investsmart.com.au/capped-fees

* InvestSMART's capped Management Fee (capped at $880 p.a.) does not include fees charged within any ETF held in this portfolio, estimated to be approximately 0.18% (indirect cost ratio), and our flat 0.11% admin fee – this covers buy-side brokerage costs. Sell side brokerage costs are not included in this calculation. For more information about fees and costs, please see the Product Disclosure Statement and Investment Menu.