Clear your debts before you invest

Before investing in the stockmarket, you should make sure your debts - apart from your mortgage - have been cleared. This is because the interest on credit and store cards, for example, is likely to exceed any gains you will make.

You should also make sure you have some cash set aside in an instant access account - typically around three month's worth - so that you can deal with any emergencies.

For more information on clearing debts, see our cash clinic on managing debt.