Investing early is genuinely valuable. But starting before you're ready can make your financial position worse, not better. Go through this checklist before putting money in the market.
Three to six months of essential expenses in an easy-access savings account. This is non-negotiable. Without it, a job loss or unexpected cost forces you to sell investments, often at exactly the wrong time.
Consumer debt at 15% APR or above should be gone. Investing and carrying high-interest debt simultaneously is mathematically irrational — the debt costs more than almost any investment earns. Some people carry a 0% balance transfer and invest in parallel; that can work if you have a clear plan for when the promotional period ends.
You need to know how much you can invest each month without that commitment becoming unpredictable. An irregular contribution schedule leads to stopping when things feel tight — which is usually also when markets have fallen.
Investing is for the long term. Markets fall, sometimes significantly. If you need the money within five years, keep it in cash. If your timeline is ten years or more, short-term falls become much less relevant.
You don't need to know everything before starting. But you need enough knowledge to choose a wrapper (ISA or pension) and a type of fund. A low-cost global index fund gets most people where they need to be. Starting before you understand what you're buying leads to panic selling when values drop.
Most people who go through this list honestly find one or two things still to address. That's useful information. Deal with them first, then invest.