Become a DIY investor in just five minutes The earlier you start saving, the less you will have to put by each month and the more you will benefit from the miracle of compound interest. So how can you set up your savings plan in five minutes? It's a two-stage process. First you set up an account with a company that offers these schemes, which can be done online or over the phone. Then you need to choose your investments. The fear is that the first stage will involve hours of tedious form-filling, and the second will mean trying to evaluate hundreds of different ways to invest your money. Neither need be true. Several reputable companies offer services that allow you to buy and manage your own investments. These firms, which can be called fund supermarkets, fund platforms or online stockbrokers, include Barclays Stockbrokers, Hargreaves Lansdown, Charles Stanley Direct, Alliance Trust Savings, Bestinvest and Sippdeal. Opening the account is simple. If you go online, you enter basic personal details and a means of confirming your identity. Charles Stanley asks for a passport or driving licence number, for example, which is instantly checked online. Once that step is completed you can transfer some money into your account, using a debit card. Alternatively, you can normally transfer money over the phone or set up monthly investments. You are then ready for stage two. First, choose which type of savings plan you want. An Isa is an ideal way to start and you can invest up to £11,520 tax-free this year, although any money you put in a cash Isa will reduce this limit. If you do choose an Isa you will need to give the provider your National Insurance number, which can be done via its website. Another tax-efficient option is a self-managed pension plan. These are called "Sipps," or self-invested personal pensions. This allows larger amounts to be saved - up to £50,000 a year currently, including all pension savings, falling to £40,000 next year - and the tax relief is more generous; although for basic-rate taxpayers the difference is relatively small. These limits relate to the amount you pay in; future investment growth is irrelevant, although your overall pension savings are also subject to a lifetime limit, currently £1.5 million, including investment growth. Finally, you could put unlimited amounts in basic investment plans, which do not offer any tax relief. If in doubt, start with a basic plan and switch to an Isa or Sipp later. Choosing which investments to put your money in is the stage that can be truly daunting for the uninitiated. But there are some obvious starting points; again, you can always add other options, or switch, later on. As long as you are investing for five years or more, financial experts say you should have some of your money in the stock market. A simple place to start is a fund that moves in line with the FTSE 100 index. These funds are called "trackers" and they are also available for other indices, such as the FTSE All Share, which covers a larger number of stocks, or overseas equivalents such as America's Dow Jones. Trackers simply own all the stocks in the relevant index - there is no need to pay a human stock-picker so the amount that is taken from your fund to cover the management company's costs tends to be much lower. Over long periods, even small reductions in costs make a big difference to the value of your savings. See our separate story for details of fund options, including more complex choices such as funds managed by expert stock-pickers and those that hold other assets along with shares. While stock market falls can be unnerving, the evidence is that long-term investments in shares do better than cash savings, despite the ups and downs. The income you receive from dividends also contributes hugely to your eventual returns. Keep an eye on fees. Some fund supermarkets impose no explicit charges but make their money by keeping some of the annual charge deducted by the fund manager (watch out for a supermarket charging more than another for the same fund). In such cases, it may be cheaper to use a supermarket that does charge a fee. Regular news and tips for fund investors: bookmark telegraph.co.uk/investing Important though your own savings efforts are, don't neglect other options if they are available. If your employer offers a company pension scheme and contributes to it, join - opting out amounts to turning down a pay rise. Consider making additional contributions, too, especially if your employer will match them. "Save As You Earn," or SAYE schemes, offer a risk-free way of investing in your employer's shares. You buy them at a reduced price, hold them for a given number of years, and can then sell them, tax-free, for a profit - if the shares have done well. If not, you can have your money back instead. A stakeholder pension is an alternative to a Sipp that offers a smaller range of investment options. Finally, consider using a financial adviser if you can't summon the nerve to start out on your own. Case study: 'I felt confident that I could make my own decisions but I needed a lot of information' One phone call was all it took for Paul Protheroe to start his Isa. I rang up because I wanted the reassurance of talking to a real person. He started my account over the phone, I chose a password, then we set up a link to my bank and I transferred some money instantly," says Mr Protheroe (above), a 59-year-old marketing consultant from Bradford on Avon, Wiltshire. He took a little more time to research his investment choices and eventually picked four funds recommended as an appropriate portfolio for medium-risk investors by his chosen fund supermarket, Hargreaves Lansdown. "I bought the funds over the internet in the end but I think the total time involved between that and the phone call couldn't have been much more than five minutes," he says. I felt confident that I could make my own decisions but I needed a lot of factual information in a form that someone without too much financial knowledge could follow. The website offered that. He said the Isas he started for his daughters, Sophie, 18, and Polly, 15, also took just minutes to set up. Mr Protheroe keeps a regular eye on his funds and has switched away from two of his original choices. The four funds he initially bought were Artemis Global Growth, Axa Framlington Managed Balanced, Hargreaves Lansdown Multi-Manager Special Situations and Jupiter Global Managed. He still owns the Axa and Jupiter funds. Visit Telegraph Informed Investing - guidance and tools tailored for your investment journey