Do you invest?

[Greentoytractor]

And if not, why not?

Obviously a lot of people can't afford to, but my question is more for people who can, but keep all of their savings in cash rather than stocks and shares. This is the position I'm in, and have only just started investing in my mid 40s. I wish someone had educated me on investing back in my 20s. Feel like I've missed a trick!

Same here. My parents are well off but they never invested either, just regularly moved savings around for best rates etc and paid into pensions. We're busy paying off the mortgage before age 49.

I've just started too! Well about a year ago. I'm not in the UK so I don't know what it's called but there's a robot that buys and sells stocks and shares for me. So my rate of interest is currently at 5.36%. Before the recent bombing it was at 6.5. Investing for dummies is how my bank advisor pitched it to me. I'm definitely going to encourage DC to do the same.

Absolutely. Read a book about the stock market and the power of compound interest when I was in my 20s and started investing in low cost trackers and leaving it there long term. Much less effort than shifting cash around for slightly better interest rates.

Now I alternate - one year sensible tracker ISA, next year slightly more wacky ISA.

No, all our cash for savings is going into a Lisa and funds for buying our first home. But once we've done that we are looking at investing. Money regularly into something with a wide portfolio (I think that's the term) that is always going to steadily grow seems to make sense for a long term investment. Ideally we would like to set something up for the dc.

watch the 7 seasons of billions show, certainly gives perspectives with investments etc

My kids all have Vanguard stocks and shares ISAs, they’re under 10 and have thousands! If they keep it investing for a couple more decades it should grow to a crazy amount. Wish someone had done that for me, must be nice 🤣

For myself I have an ISA but not as good, and premium bonds but not enough in there anymore to win very regularly.

Yep, have been banging cash into my pension and S&S ISA for years, all in global equity trackers, and it's no exaggeration to say it's changed my life. In my mid 40s I'm already as sure as I can be that I'll have a very comfortable retirement from my mid 50s at the latest. If I'd stayed in cash or stuff like premium bonds I'd be absolutely nowhere near the same position. I've never once picked a stock or switched investments, don't see the point, just keep the payments going in through thick and thin and forget about it - I'm as passive as it's possible to be.

I don't believe that investments will really work going forward. Big part of the so called portfolio values is just a big bubble caused by (some) people having too much money on their hands and it can be erased at any moment.

Investments are essentially about trying to get something for nothing.

If you can go without your savings for a year and not touch them,put them in a bond.
Interest is slightly higher and some if them you can get monthly interest.
1 year bond.

I would recommend having a look on the Boring Money website, it's very much aimed at encouraging more women to educate themselves in how to invest. It cuts through the jargon and makes investing feel much less daunting. You also receive a very amusing newsletter every Friday which always brightens my day. It's run by a woman for women, highly recommended.

@NotAnotherScarf the times has a campaign to get 15 hours into schools of proper invesment .

@Greentoytractor yes I do but like you far far too late !
Unlike you I've never had tens of thousands sat doing nothing ..

For those wondering what to do some good podcasts and links already there but read the classics like a simple path to wealth...and so on

Buy broad and diversified and it all balances out s d you can't go wrong.
I've drummed it into my DC and my 14 year old wants be to buy her shares. She has a sipp junior stocks ISA.

@Babsandherwabs agree and I've done a sipp for mine self invested personal pension again as I approach pension age I wonder how amazing it would have been to have little bonus pot to look forward to

This. Global equity trackers are the easiest and cheapest way to invest. Most managed funds do not achieve higher returns and have eye-watering charges that erode any gains.

As for “so called portfolio values is just a big bubble caused by (some) people having too much money on their hands and it can be erased at any moment. Investments are essentially about trying to get something for nothing”… That’s just ridiculous. For evidence of how ridiculous a statement this is, check out Warren Buffet and Berkshire Hathaway.

What a shame this is your outlook.

Have a look at a stocks and shares ISA and just start putting some money in each month. I was also overwhelmed with choice, returns, fees etc. So many opinions and reviews.

But I decided that just making a start on something was better than doing nothing. So I opened a Nutmeg account for the children and added the investment section to Monzo for me. I know they’re probably not the best ones, but both were very easy to open so I just did it. The Nutmeg app is now called JPM Investing for some reason.

It was a bit concerning to start with as I did it just after Trump and the tarrifs chat so it was consistently losing money. But I held my nerve as people said you need to and now Monzo is up 13%. I took the advice of only investing what you can afford to lose so I still save into a normal savings for easy access money.

Which part of that isn't true in your view?

Yes, I use my full ISA allowance every year and pay AVCs. I’m also about to open a GIA.

’m about 70% global developed world tracker plus a few smaller holdings in value funds I like.

Going to have to start derisking a proportion soon which I think is going to be a different challenge.

https://rebeldonegans.com/finance/rfs/course-notes/?fbclid=IwVERFWAQSVItleHRuA2FlbQIxMQBzcnRjBmFwcF9pZAo2NjI4NTY4Mzc5AAEeHqScYjGgsytFy-fAMOCEnLcMnVy5ZFTd031aRxVxdO9g7fBGbbihMWDMSFMaem8IzgnTdSsclOPxkDQUICA#roadmap

this is the link for Rebel finance school. They also have a Facebook page which is very useful.

I had no idea bout investing but this breaks it down I watched all the videos here before deciding to invest. There are some very clear basics guidance to follow that will suit th majority of the population.

look into JISA fo kids. SIPPS an JSIPPS for pensions for kids and adults.
absolute game changer.
the tax free wrapper and the compound interest is incredible.

this honestly change my life and I wish I had started investing decades ago.

I’m not sure I understand your position.

The logic of the stock market is that people constantly find ways of starting companies that build value and grow. That could be by digging resources out of the ground, making clothes, selling food, making weapons, the list is endless. Individually some of those companies will fail, but at the same time other people will spot opportunities and will start new companies that thrive and grow.

By investing in an index tracker you get to own a piece of a large swathe of those companies (which ones will depend on the type of tracker you choose). The individual failures are outweighed by the successes and the new starters because ultimately as long as there are people on earth, those people will have needs and wants that they are willing to pay to be satisfied. Companies, and stock markets, grow by successfully finding ways of fulfilling (or creating!) those needs and wants.

it sounds like your take on this is that the whole system will somehow collapse, but to realistically happen that is a sort of “end of days” scenario for humanity. At that point I think we’ll have much bigger problems than losing money on the stock market, so I don’t think I’d be prepared to bet on it - certainly not at the risk of losing out while the wealth grows.

One of the biggest issues I see is that the wealth that is being generated is concentrated in the hands of fewer and fewer people - hence why we now have billionaires and probably the worlds first trillionaire soon.

Ordinary people need to get some of these benefits too, and owning a stake in these companies is the only way that will happen. Keep your money as cash and you are standing on the sidelines watching the rich get even richer, leaving you further and further behind.

Good post, @Nesbi I think some people think of buying shares only in terms of meme stock/pump and dump schemes, whereas proper investing is a million miles from that.

I understand that seed funding is valuable and it is high risk high reward operating.
It just isn't what small investor buying SP500 index does.

I saw something about tech companies valuations in last 10 years, and the relationship between real value and investment/stock market value is rather vague. Institutional investors had a lot of money and just wanted to be part of the next Big thing. So they tried to create their own.

Yes, you can say that market value is the only value that matters, but the wealth isn't really yours until you cash it out.

I think it is reasonable to be cautious about the over-valuing of tech stocks, and if you invest in the S&P500 those sorts of companies will make up a significant part of the portfolio.

Personally I have money in a US index, but I also have money invested in an international index, an emerging markets index and a FTSE All Share tracker. I also have money invested in a couple of other portfolio’s which rely on the fund manager making active choices, and I have some in an ETF tracking the value of gold (as a useful hedge because the value of gold often moves against the value of equities as people tend to buy more when they are looking for a safe haven).

Overall that helps me spread my risk, as the money goes into big companies, small companies, companies in the most developed countries and companies in developing countries. The aim is not to eliminate risk, but to find a reasonable balance between risk and reward.

At the same time I have to be conscious that keeping my money in cash isn’t a risk free decision either, because that leaves it vulnerable to the effects of inflation. I don’t want to see my savings lose their value, and so taking a little investment risk is necessary to help ensure that won’t happen.

As other people have noted, getting into investing can be fun! As long as you can avoid getting too emotional and panicking when the markets become volatile (as they are now because of the war in the Middle East) it is fascinating to watch how your money can build up over time. Eventually it starts to feel like there is an extra “you” out there in the world, earning money on the side without you having to do anything!

Eventually it starts to feel like there is an extra “you” out there in the world, earning money on the side without you having to do anything!

Yes, I know it worked for some people and some generations, but the idea that you will get money for free without putting in effort or relevant skill is suspicious.

It's just a business with hope and fomo. The price for trading one stock now is different than realistic value when a whole generation will try to sell their portfolios some twenty years from now.

I'm not saying people shouldn't do it at all. I'm saying that it's celebrated as some kind of infinite money making machine.

@FourSevenTwo

People in retirement need 'something for nothing' - whether that's a taxpayer funded final salary pension scheme, state pension funded by current taxpayers or an investment portfolio.

The unemployed and disabled also want 'something for nothing'. Do you consider that to be wrong?

You make long term financial planning sound like a dirty, grubby and exploitative activity. I'd hazard a guess that you work in the public sector and have no such qualms about your final salary pension being funded by my children when they're old enough to pay taxes.

What app do you use? X