Why you should set up recurring deposits (and when to increase them)
Putting your investing journey on auto-pilot is a powerful way to grow your wealth sustainably over the long term. Recurring deposits allow you to skip the hassle of manually depositing money into an investment account or trying to time the stock market.
What is a recurring deposit?
When it comes to investing, consistency is key. But, remembering to put funds into your investment account can be a challenge.
Recurring deposits allow you to automatically transfer a specific amount of money from your bank account into your investment account at a dedicated time.
It’s simple – You choose how often you make a transfer (i.e. fortnightly or monthly), and how much you’ll invest.
Not sure how much your recurring deposit should be?
One way that you could think about it is to subtract your expenses from your net income (the amount of money hitting your bank account after taxes and deductions). With that number in mind, decide how much you are comfortable investing on a regular basis. Even a small amount is great.
The psychology behind recurring deposits
Science is on your side when it comes to automating your investing journey.
Behavioural psychology research tells us that habits are formed by repeating behaviours. This means that setting up recurring deposits may help you stay consistent and committed to your money goals, since automating actions like this become habits that no longer take active decision-making or rely on our willpower.
That’s what makes recurring deposits such a powerful way to boost your chances of success, especially when it comes to growing your wealth. By taking the manual processes out of investing, you can boost the chances of you reaching your money goals.
Related: learn how recurring deposits support a successful dollar cost averaging investment strategy
How Verve can help you automate your investments
At Verve, we want to help you reach your money goals, no matter where you are in your investing journey. Check out these ethical investing options, where you can set your money goals, invest in line with your values and build a brighter tomorrow.
We’ll help you to set up a recurring deposit, track your progress, rebalance your investments and reinvest dividends.
Related: When to increase your recurring deposits to optimise your portfolio
Ready to start building your wealth and investing in a more ethical future?
Take the first step towards a brighter financial future and sign up for Verve Money today.
This article is published by Verve Money Pty Ltd (ABN 71 653 669 366, AFS Representative No. 001294184), a Corporate Authorised Representative of True Oak Investments Ltd (ABN 81 002 558 956; AFSL 238184), as the Manager of Verve Money. A friendly reminder that all the financial information contained in this article is general in nature and does not take into account your personal financial objectives, situation or needs. It’s important to do your own research and consider getting in touch with a professional adviser to access specific information tailored to your unique situation.
You should read the Product Disclosure Statement, Investment Guide, Target Market Determination and Financial Services Guide before making a decision to acquire, hold, or continue to hold, an interest in the Verve Money Fund. Visit www.vervemoney.com.au/documents to view these documents.
Interests in the Verve Money Fund (ARSN 662 622 899) are issued by Melbourne Securities Corporation Limited (ACN 160 326 545, AFSL 428289). When considering financial returns, return of capital is not guaranteed and past performance is not indicative of future performance.