Regular investing is a way to put money into an investment(s) at fixed intervals, typically every week or month. The amount is often invested automatically without the investor having to time the market. The approach is commonly used with investments such as funds and individual stocks; however some crypto platforms also offer recurring purchases of crypto assets. In this guide, we will explain how regular investing works and the risks to consider.
The information presented here does not constitute financial advice but is for educational purposes only. Please do your own thorough research or consult a professional to better assess the risks of investing in crypto assets.
Regular investment plans let you invest fixed amounts at set intervals, often automatically, into assets
You can typically start with contributions such as £10-25 weekly, fortnightly, or monthly, depending on the provider. Contributions may be funded from an available account balance or through supported payment methods.
This is where a regular fixed contribution buys more units when prices fall and fewer when they rise.
They can help build investing habits and spread purchases over time, but they do not remove risk, and prices can still go up or down.
Regular investment plans are one approach investors use to invest fixed amounts over longer periods. Rather than waiting until you have a large lump sum, regular investing might let you start with smaller amounts.
Some platforms allow contributions starting from as little as £10 or £25 per month, which can make regular investing more accessible.
By investing a set amount at regular intervals, the amount invested naturally buys more units when prices are lower and fewer when they’re higher, reducing the pressure of attempting to time the market.
Automating contributions can help establish a consistent savings habit.
Some investors choose to start regularly investing earlier in life, hoping to benefit from potential long-term compounding effects and to work towards their financial goals, although this is never guaranteed.
The value of an investment can go down as well as up, and you may get back less than you put in, or nothing at all.
A regular investment plan involves an automatic arrangement being set up with an investment platform, bank, or broker to put money into selected assets at pre-determined intervals. Instead of having to decide when to invest or wait until you’ve saved enough, your chosen contribution is invested monthly or weekly without you needing to manually place a trade each time.
Some of the key features of regular investment accounts include:
Choice of assets. Options for regular investment plans typically include exchange-traded funds (ETFs), shares, bonds, funds or investment trusts. Some crypto platforms may separately offer recurring purchases of crypto assets or crypto indices, as available on the platform, which come with heightened risk.
Automation. Depending on the provider, your chosen amount may be deducted from an available account balance or funded through a supported payment method, so purchases or investments can take place automatically at the selected interval.
Pound-cost averaging. Because you’re investing the same amount regardless of the asset price, your fixed contribution automatically buys more units or shares when prices go down, and fewer when they increase. Please note, regular investing can result in a higher average purchase price than investing a lump sum, depending on market movement.
Compounding. Any gains, dividends, or interest generated can typically be automatically reinvested, which means potential future returns are calculated on a larger holding.
Adjust as needed. Most plans will let you change your contribution amount, switch investments, pause contributions, or cancel altogether if your circumstances change.
Monthly investment plans in the UK typically come in two main forms:
Self-directed plans let you choose your own investments from funds, ETFs, bonds, and shares.
Ready-made portfolios are compiled and managed by the provider to match your risk level, which could range from cautious to adventurous.
Pension plans often work this way too, with regular monthly contributions invested automatically for retirement.
Managed regular investments typically come with higher fees that can make them the more expensive option. The self-directed option requires investors to be confident in their understanding of different asset types and their risk levels.
Crypto assets are typically offered by crypto platforms.
Pound-cost averaging is one of the reasons people choose to invest monthly. When you invest the same amount regularly, you spread your money across changing market conditions instead of trying to guess the best moment to buy.
Instead of investing a single lump sum at one price, your fixed contribution buys different amounts of an asset depending on its price at the time of each investment. After several months, this results in an average purchase cost per unit.
Pound-cost averaging does not remove investment risk or guarantee returns.
| Month | Monthly investment | Asset price | Units bought |
|---|
In this example, the contribution stays the same each month, but the amount of the asset received changes with the price.
Regular investment plans can mean different things depending on the provider. In the UK, investment platforms may offer regular investing into funds, ETFs, investment trusts or individual shares. Separately, some crypto platforms offer recurring purchases of crypto assets or crypto indices. Crypto Savings Plans are not the same as stocks and shares ISAs or regulated investment plans and do not carry regulatory protections such as the FSCS or the Financial Ombudsman.
Funds
Funds pool money from many investors and use it to buy a mix of assets. That might include shares, bonds, or other investments, depending on the type of fund.
Exchange-traded funds (ETFs)
With ETFs, you invest in a whole basket of companies or assets at once. ETFs trade on a stock exchange, like shares. They might track a market index, such as a group of large companies, or a specific sector, and can give you broad exposure to a market in a single investment. Because they are traded on an exchange, their price can change throughout the day.
Investment trusts
These are listed companies that pool money from investors and use it to buy a portfolio of assets. They can invest in shares, bonds, property or other assets, and their shares are also bought and sold on the stock market. Because they are closed-ended, their share price can move above or below the value of the investments they hold.
Individual stocks
You can also use a regular investment plan to buy shares in individual companies. This gives an investor more control over what they invest in, but it also means that any returns depend more heavily on the performance of those specific companies.
Crypto and crypto indices
On some crypto platforms, you can also set up recurring purchases of crypto assets such as Bitcoin or Ethereum, or crypto-related indices.
For UK users on the Bitpanda platform,the Bitpanda Savings Plan is limited to eligible cryptoassets and Bitpanda Crypto Indices. Crypto assets are typically more volatile than other asset classes, and their value can rise and fall significantly over short periods.Do not invest unless you’re prepared to lose all the money you invest.
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Get started nowPotential investors might think about their goals, how long they plan to invest, and how much risk they are comfortable taking.
Time horizon: Regular investing is often used for longer-term goals, because markets can move up and down significantly in the shorter term.
Attitude to risk: While all investments can go down as well as up, different assets carry different levels of risk, with crypto assets typically associated with higher volatility and a greater risk of significant losses.
Diversification: A regular investment plan can sometimes be used with a diversified mix of investments, but this depends on the platform and product used. A crypto Savings Plan should not be assumed to provide the same diversification or protections as a mainstream regulated investment plan.Regular contributions: Investment frequency and amount is an important consideration, but in many cases, levels can be adjusted or the plan paused depending on the provider and account terms.
Costs and charges: Investment platforms and products may involve fees, such as transaction fees or fund management fees.
Access to money: Some investments may be easier to buy and sell than others.
Tax considerations: The way investments are taxed depends on the product, account type, and individual circumstances, and some people in the UK use tax-efficient wrappers like stocks and shares ISAs for certain types of investing, where available.
You can get started with regular investing through a regulated provider such as a brokerage or investment platform.
Research platforms that offer regular investing and the asset classes you are interested in.
Register and verify your account.
Add a payment method to fund your account, such as bank transfer or debit card.
Choose your investment products.
Select your contribution amount and frequency, such as weekly, bi-weekly, or monthly.
Review the details and confirm within the platform.
Depending on the provider, you may be able to temporarily pause and later resume your plan at any time.
With the Bitpanda Savings Plan in the UK, you can set up recurring purchases of eligible crypto assets and Bitpanda Crypto Indices through the platform or app. Do not invest unless you’re prepared to lose all the money you invest.
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