5 Low-Risk Ways To Invest Every 20 Something Must Know – Pt.2

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Following on from part one, which I highly recommend you read here. Let’s look into another 5 low-risk ways for 20 somethings to invest.

1. Invest By Increasing Your Super Contributions

Firstly, let’s talk super. Before you consider contributing additional funds to super, it’s important to ensure your super is consolidated into one account. Consolidating your super accounts will instantly save you the nasty fees that come with having multiple superannuation accounts open.  The ATO (Australian Taxation Office) has some great resources on how to track and consolidate your super. 

But how does super actually work? It may be news to some of you, (like it was for me) but your super contributions don’t just sit in a bank account somewhere until retirement. Your super is actually invested in different asset classes designed to produce a return.

Thanks to the power of compound interest, small additional contributions to your super through salary sacrifice can reward you in a big way come retirement time. Increasing your contributions to super will not only boost your retirement fund, but it will also reduce your taxable income. Have a chat with your accountant about the potential tax benefits.

By law, employers are required to contribute 9.5% of your pre-tax income into a superannuation fund of your choice annually. Speak to your employer about making extra contributions via salary sacrifice (typically your accounts team) and they should be willing to help out. An extra percentage point per year (10.5%) is a good place to start to gauge how you handle the change to your disposable income.

 It’s important to check your super balance every 3 months or so to ensure your employer is actually paying you the super you’ve earned. There are some horror stories out there, so stay diligent and check your balance quarterly. 

2. Investvestments In Gold

For any 20 something, owning a gold bullion might sound like a thing of the past. But actually, Gold is commonly used as a safe haven or hedge investment against volatile market conditions due to its stability, tangibility, and consistent performance. Because of its safety, Investors employ gold to preserve their wealth from economic storms. During the 2008 Financial Crisis, Gold spiked to roughly $870 per ounce and hit an all-time record of $1,895 in September 2011. 

Fortunately, there are a few options to invest in gold without having to worry about storing it securely yourself. A common option for young investors to consider are ETFs that track the underlying value of gold. Alternatively, you could also buy shares in gold mining companies listed on the ASX. 

ASX:PMGOLD (Perth Mint Gold) is my pick of the bunch. PMGOLD set-up to track the international spot price of gold in Australian dollars, it also has one of the lowest management fees (0.15% P.A.) in comparison to other gold exchange traded products. PMGold is also backed by the Australian Government, which gives investors the right to withdraw their physical gold bullions.

3.  Investments In Property

Getting into the property market in your twenties is becoming harder and harder.  20 somethings are suffering from rising Property valuations and painfully slow wage growth. This one-two punch is pushing us to the outskirts of the market.

To invest in physical property, you’ll need a large deposit (in most cases) in order to apply for and potentially be approved for a home loan. To be approved for a home loan, financial institutions need to see reliable income and good spending habits among other things. Once your loan is approved, you’ll need to pay interest and potentially your principal loan amount back to your creditor. This is dependent on how your loan is structured.

If you are one of the lucky few able to invest in physical real estate, history says that it’s generally a safe place to compound money over time.  

Depending on where you live in Australia, you’ll notice that property prices have steadily risen over the past 50+ years. In fact, from 1993-2018 property delivered an average annual growth rate of 6.8% and 5.9% for houses and units respectively according to CoreLogic

Two house viewed at from street view.

4. Investments In A-REITs

As mentioned above, getting into the property market in your 20s is becoming a tall order for young Australians. But fortunately, there are alternatives to physical property ownership to help get your foot in the door.

Australian Real Estate Investment Trusts (A-REITs) can provide exposure to the real estate market without going through the process of purchasing a physical investment property. A-REITs own and usually operate, income-producing real estate. That income, mainly generated through rent is then passed onto shareholders through distribution payments. REITs can also provide you with capital growth should the value of their portfolio rise.

A-REITs invest in industrial, commercial, and residential properties both domestically and globally. Best of all, they’re listed on the ASX (Australian Stock Exchange), which means you can invest in them like you would with any other listed company.

Like any investment, proper due diligence is essential before investing any capital. if you’re interested in reading more about how A-REITs can work for you, check out this write up from Real Commercial.

5. Invest In Yourself 

Leaving the best until last, the best investment you can make in your 20s is in yourself. That’s right, you. Your capacity to learn is not fixed and never will be. It’s when you’re willing to commit to lifelong personal growth, that you’ll see unimaginable outcomes.

Benjamin Barber, a political theorist, once said, “I don’t divide the world into the weak and the strong, or the successes and the failures, those who make it or those who don’t. I divide the world into learners and non-learners.”

Developing a growth mindset early on in life is a certainty to pay dividends later on in life. It’s about challenging yourself to learn something new. So pick up that book that’s been sitting dormant for too long and keep learning!

Open book with reading glasses rested on top of the book.


Developing healthy financial habits in your twenties will leave you in good shape for larger financial commitments later in life. Saving more money than you spend now and educating yourself about investment opportunities will put you in the box seat for financial success into your 30s, 40s, and beyond!

P.S. I’d love to meet you on Twitter: here.

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DisclaimerThis website (the “The Money Pal”) is published and provided for informational and entertainment purposes only.  The information in the Blog constitutes the Content Creator’s own opinions and it should not be regarded as financial advice.

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