Building a financial plan is essential to achieving your financial goals through investing. Here’s a step-by-step guide on how to determine how much to invest and where to start:

1. Assess Your Current Financial Situation:

• Income and Expenses: Calculate your disposable income after covering all necessary expenses (rent, bills, food, etc.).
• Emergency Fund: Ensure you have an emergency fund (3-6 months of living expenses) in a safe, accessible account before investing.

2. Define Your Financial Goals:

• Set clear goals, whether they are short-term (saving for a holiday or home deposit) or long-term (retirement or children’s education). These goals will influence how much you need to invest and what types of investments are suitable.

3. Decide How Much to Invest:

• A general rule is to aim to invest at least 10-20% of your income, but this can vary based on your financial goals and timeline.
• Use a budgeting approach like the 50/30/20 rule, where 20% of your income is allocated to savings and investments.

4. Start with Low-Cost Investment Accounts:

• Consider tax-efficient accounts like a Stocks and Shares ISA or a pension (SIPP) for retirement. These accounts help minimize taxes on returns, allowing your investments to grow faster.

5. Choose the Right Investment:

• For beginners, low-cost index funds or ETFs are good options as they provide diversification and lower fees.
• Automate your investing through regular contributions (e.g., monthly direct debits), allowing you to benefit from pound-cost averaging.

Start small, stay consistent, and adjust your plan as your goals and financial situation evolve.