Ask Paul: I'm digging myself out of debt but what comes next?

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Christine: I earn $60,000 a year and last year I put myself under a debt agreement.

I felt it was my last option due to the circumstances at home. I've made bad decisions in the past and am now straightening things out in my life.

I have decided to put aside money to buy shares as I feel it is a good start in preparing for my future.

Christine entered into a debt agreement following some bad decisions. She asks Paul Clitheroe for advice on saving or investing.

I am turning 30 this year and I feel stuck. I need your insight into whether it is a good move to start investing in shares or save my money.

Paul: A debt agreement is not a pleasant experience, Christine, but good on you for taking responsibility.

You have two really big things going for you.

First, you have said you made bad decisions. This is really important. People who say it was all someone else's fault learn nothing.

Second, you earn a good salary and you are only 30. So by recognising your mistakes, taking responsibility for them and then knuckling down and starting to put money aside is music to my ears.

Frankly, the key issue for me is that you are saving. Shares are a great idea if you plan on holding them for the longer term, say at least seven years.

If, however, you think you might want to save a deposit for a property, then building cash in a high-interest account is a pretty good plan. If unsure, shares are fine.

They may go up or down in the short to medium term but you can always access your money if your plans change.

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Paul Clitheroe AM is founder and editorial adviser of Money magazine. He is one of Australia's leading financial voices, responsible for bringing financial insight to Australians through personal finance books, the television show Money, radio, and most notably this publication, which he established in 1999. Paul is the chair of the Australian Government Financial Literacy Board and is Chairman of InvestSMART Financial Services. He is the chair of Financial Literacy at Macquarie University where he is also a Professor with the School of Business and Economics. Click here to email Paul your money question. Unfortunately Paul cannot respond to questions posted in the comments section. Please view our disclaimer here.