Now you're in the workforce and earning a regular income you will be looking for ways to invest your hard-earned money for the best returns. You may want to keep a minimum amount of money in a bank or credit union account with easy access for everyday needs. For your other savings you can adopt a diversified investment strategy to meet your specific financial goals.

Everyone would like to choose investments that offer maximum returns. But higher returns usually mean higher risks. Before choosing investments you have to think about the level of risk you are prepared to accept. Your age, income and family circumstances will all influence the degree of risk you can-or should-take. Here are some investment options to consider.

PLUSES	MINUSES
Cash Lowest risk Immediate access	Lowest returns No capital growth
Term deposit Low risk Guaranteed returns	Often low returns No capital growth
Fixed interest/bonds Low risk Capital growth Easily sold	Often low returns Can fall in value
Shares High long-term returns Capital growth Fairly easy to sell Tax advantages	Volatile returns Prone to sudden falls
Property (Direct not listed) Medium-high long-term returns Capital growth Cannot be sold quickly	Prone to cyclical falls High cost
Superannuation High long-term returns Capital growth Tax effective Access to investment markets	Funds accessed at retirement Subject to Legislative changes

Investor profiles

The following table may help you decide the sort of investor you are when it comes to risk.

Investor	Profile
Very conservative	Looks for investments that offer security Does not want to lose any of their money Prepared to accept low returns
Conservative	Willing to accept a little more risk if it will help improve overall investment returns.
Moderate	Wants a balanced mix of investments offering both income and growth opportunities.
Aggressive	Strives for high returns and wants most investment in assets which have the potential to grow strongly in value.
Very aggressive	Focuses almost totally on capital growth and is prepared to accept high risk and volatility in chasing the highest returns possible.

Timeframe

Investment timeframe will play a role in deciding what sort of investments you should make. Identifying your financial goals and the levels of risk and return you are prepared to accept will be helpful in implementing your investment strategy.

Income

Income plays a key role in determining your approach to investment. If you have a low income or live on the income from your investments or have only a small amount free to invest, you will take a more conservative approach than someone with a large income who might not be too badly affected if their investment suddenly fell in value.

Investment goal

Your investment goal also has an impact on the kind of investment you are likely to make. For example, if you are saving to buy a car (short-term goal) you will want to avoid high-risk investments. But if you are investing for the long term, you can afford to take more risks in search of higher returns.

The right mix of investments - don't put all your eggs into one basket

Now that you know what the main investment or asset categories are, your next task is to decide what mix of investment suits you.

A balanced investment or diversified portfolio spreads the risks by investing in different types of assets, for example, cash, shares, property-and ensures you are not too exposed to any one asset class.

For example, if there was a major fall in the value of shares then returns from your other investments would at least partially offset this.

Or when low interest rates mean low returns on your cash or fixed interest investments, your shares may be performing well.

To decide on a mix of investments to meet your needs, talk to a financial adviser who will tailor a portfolio especially for you.

Investment Options

Investor	Investment mix*
Very conservative	Cash 35% Fixed interest 65%
Conservative	Cash 25% Fixed interest 40% Property 5% Shares 30%
Moderate	Cash 20% Fixed interest 25% Property 10% Shares 45%
Aggressive	Cash 10% Fixed interest 15% Property 10% Shares 65%
Very Aggressive	Cash 5% Property 10% Shares 85%

*These figures exclude the family home, which may be your latest investment. Your home is a special type of investment because it is not purchase just for the returns it might generate. Any other direct property investments are also excluded and it is assumed your property exposure is gained through managed investments.