It would be correct to say that there is not one investment strategy which is suitable for everyone, but the dilemma of choosing the right investment strategies for young people is particularly difficult because of their varied needs. Because they will often have different plans for their money, it may well be suitable to use one strategy for some of their funds, and a different strategy for another segment of their funds.

As a young person in today’s world, you will have so many goals that you may be working towards. The purchasing of your first home; planning for your children’s education; putting something towards your retirement savings; as well as being aware that as plans change you may often want to pull some money out immediately depending on how your situation changes. The vast array of demands in what they want is what makes choosing the investment strategies for young people particularly difficult.

The first part of the conundrum is considering the possibility of needing quick access to their funds if their plans or situation changes. Of course, you could keep these funds in a cash savings account, but the interest you would receive is unlikely to keep pace with inflation, and for a reasonable rate of interest you will usually need to look at fixed-term savings products, which will have penalties for early withdrawals. The alternative for this part of the fund is to consider keeping the funds in stocks which are well known, and have retained their value well while also providing a dividend income which can grow their investment too.

Planning for your children’s educational needs can be a simpler investment goal, because you will know when your children are likely to go to college or university, and thus can put the plan in place with a fixed withdrawal date. As with most longer term strategies, considering taking on slightly riskier investments will likely bring better growth in the earlier years, so perhaps investing in small company funds or emerging markets funds, while withdrawing to a more secure investment is recommended as you approach the maturity date.

Unfortunately, the problem with securing the right investment strategies for young people is that the more strategies are used for different segments of their funds, then the more likely it is that one or more areas may underperform, but the overall goal will be that as you spread the investments, one will outstrip the others to recoup any shortfalls caused by the areas that don’t perform as expected.