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!

@FourSevenTwo - I think the way to look at it is that you are not getting money “for nothing”. You are letting companies, perhaps hundreds of companies, use your money to operate and to grow.

The companies that succeed will be able to pay their directors and employees in return for their time, skill and labour, and they will also pay you for trusting them and letting them use your money.

Sometimes a company might do really well, so much so that as it rapidly grows, the value of your stake in that company will grow rapidly too. But even if a company isn’t necessarily always able to keep growing it may still be run sensibly and be able to generate a profit, year after year. If so, then some of that profit should find its way back to you in the form of dividends.

This isn’t something that was only available to past generations. You can invest in proven companies that have been around for decades, just as you can invest in new companies that are coming up with new ideas and which might become the success stories of the future.

Im not sure why you think a whole generation will try to sell their portfolios 20 years from now? But if they do, and if the companies in those portfolios are doing well, then that generation of sellers will find a lot of buyers wanting to take the shares off their hands, and perhaps start their own investment journey!

I am so thick I need someone to explain it to me or do it for me. I put a large sum of money into a Chase account this week because it’s offering 4.5% interest. Had no idea I would be taxed on already taxed money 🥹I have kept it just below the protected amount as I had no idea that banks could go bust 😂. Also I don’t want to lock my money away incase I move later this year. I know cash isas are tax free.. but the return is so crap on ones that are not locked. It seems pointless. I keep seeing things about trading but don’t know where to start. I did 50k into premium bonds. Shall I give £50k to my husband too do this too? Haven’t done anything for my young children yet as I’m looking to move. HSBC have a good savings rate atm and if I put in 100k I get medical insurance travel insurance and lots of other little perks.

Yes. I’m in my early 30s and I invest monthly into a S&S ISA and have done for years only a small amount each month but have nearly £30k in there now. I use Vanguard life strategy 100 funds as they are a low cost tracker fund.

My husband also invests into a S&S ISA and we invest a small amount monthly into a JISA for our children.

we also both have workplace pensions. I pay 15% monthly (including employer contributions). My overpays into
his pension massively to avoid the £100k tax trap (2 kids in nursery!!) both of our pensions are invested in high risks funds as we don’t need to access them for a long time.

Yes. I'm just turning 40.

I max out my S&S ISA each year. My ISAs are retirement tracker funds so adjust risk year to year.
I have a couple of low-value regular savings accounts.
I have an ETF which is doing well.
I have a few thousand in a British Bonds account which is just over 4% so not brilliant but safe.

Not 'investing' really but I have full Premium Bonds holdings and its only a matter of time until I win a million on those 😅

I also have a chunk of shares in two start-up companies valued at about £10m each. I don't really see this as part of my portfolio though because they're very high-risk and I didn't actually hand over any money for these.

I know this.

At the same time, price is artificial to a big extent and depends on the amount of free money people have and want to invest through this system. Lately there are so many people hoping to get safe returns over inflation without any kind of expertise or work put into it, that it's unclear whether the value is really there, or the market with the illusion of unlimited growth is turning into a a huge multi level marketing situation.

It's important that people understand that it's not a silver bullet, that their portfolio value is theoretical to some extent, and it's a bit of luck, whether it will really work out in the end for them personally or not.

Invest Engine, it's so easy to use, some weeks my investments make more than I've made at work, it's lush to see. I just ignore any bad weeks though 😉

How much have you lost on a bad week 😂 and when you say made more at work do you mean monthly or yearly 😂 because I want to aim for 5k to buy myself a Rolex from any winnings.

War doesn’t mean your stocks and shares won’t perform. Defence and oil and gas type industries do well at times of war and there are often significant portfolios held in these types of companies.

Yes i do. But the thing with investing is:

• it needs to be money you don't need, that you can leave for years. If its money you need, you can get unlucky and have to sell out in a downturn and lose a lot. This happened to me when i was younger, it was frustrating watching things bounce back up a few months later.

I've learned now that its best to have an emergency pot/rainy day money in cash, that means you aren't desperate and can "wait out the cycle" with investments and divest at a better time, rather than being forced to sell low.

Most investment principles are based on you understanding the fundamentals/strategy of the company or fund, and planning to hold it for 5 years or more.

@JessicaRabbit23 - you want investing to be as dull as possible! The best way is to make regular monthly payments that just keep getting paid in regardless of whether the market is up or down. Sudden growth or sudden drops are just noise, try not to think about them too much. The timelines for investing are best measured in decades though because even in the event of a really significant drop in the markets (say 40%) you have plenty of time to recover.

If you think you will need the money soon though you are better off doing what you are doing - looking at accounts that offer interest rates. Try to compare the tax free rate you will get from an ISA with the rate after tax that you will get from an ordinary account.

If you do start to invest, the worst mistake most people like us (ie non Finance professionals) tend to make is thinking they can time the market - that they will be able to sell in time to avoid the drops and will know when to buy back in while it’s still cheap but about to go up. That’s pretty much impossible, far better (but less sexy) to just keep putting money in regardless!

I use Hargreaves Lansdown for investing in ISAs but there are lots of other platforms that offer similar services, some are cheaper and some cost more so best to do a bit of research and decide which one you like the look of.

The biggest advantage you have when investing is time. Time reduces risk (because you have that extra time to recover), and it allows you to benefit from compounding. As your investments grow, the speed at which they grow accelerates. Starting early with a regular small amount is good advice to give to kids as time is the one resource they have loads of!

Its also really really important to be diversified. Some stuff will fail/fall, its a given, how you protect yourself is by being spread across a range of investment types or asset classes, buying funds that hold a lot of different shares.

"Bad" events in the press are rarely bad for everyone, and if you holda few different things you are protected to a degree from a big dip in a particular market or sector. For example right now the emirates airline is probably taking a beating but the asian ones will be picking up tons of stranded passengers and rerouting long haul via singapore/KL and charging them a fortune to get home. In covid retail & hospitality dropped but companies selling leisure equipment, home improvement stuff & garden stuff had bumper years.

I have done, I have also lost money

if you know an industry ect will lose value you can short the stocks etc

like the film the big short or margin call

I've been investing for over 30 years. My biggest hits were buying shares in Apple and Amazon during the global financial crisis. I still have them and sell covered calls on them to generate income.

@MissConductUS what's does that term mean ,sell covered calls ?

I skim off mine ,I made the mistake during COVID of not skimming Scottish mortgage when it went up by thouadands

My initial investment has more than doubled in 7 years
Now I have a set minimum limit eg £10 and if I need a top up of something and it goes over £10 I skim now .only if I need to top stuff up.

Eg I was able to skim 1500 recently to pay for my holiday acxmd

Selling covered calls is an income-generating options strategy where you own shares of a stock (the "covered" part) and sell (or "write") call options on those same shares to someone else. You receive an immediate cash payment (the premium) but agree to sell your shares at a set price (strike price) if the buyer exercises their right

@Nesbi excellent posts you should have your own invements corner !

I'm a bit scared to after losing all my investment once in a particular scheme. If anyone has any advice on 'safe' options? Xx

A global large cap etf is probably the closest thing to 'safe' over a 10+ year period - but there are no guarantees.

I invest in LGGG which is a fund that holds the world's largest 1500+ companies. If you buy one share in LGGG, you are buying tiny holdings in every large multinational that you can name - Boeing, Apple, Google, Shell, Exon Mobile, Toyota, Volkswagen, Samsung, Sony, Barclays, Chase, Astra Zenica, Pfizer, etc.

To lose everything, every single multinational would need to simultaneously go bankrupt. If that did happen, we'd be looking at a Mad Max style scenario, so it's not something I'd worry too much about.

Investments can still go up and down of course, but that fund is spread over all major economies, which helps to smooth things out - America, Japan, Germany, France, UK, Taiwan, South Korea, Canada, Italy, India, China, etc.

Correct. To elaborate a bit, today I sold a CC on my Apple shares with a strike price of $285 per share. It’s currently trading at around $260. As long as the price stays below $285 for the next three weeks, the options will expire and I’ll just pocket the premium. If the price goes above $285 in that time, the buyer will exercise the option and I’ll have to sell them the shares. In practice, I can just buy back the options at a loss that conveys the same profit to the buyer.

https://www.investopedia.com/articles/optioninvestor/08/covered-call.asp

I’m recently retired, and this is a nice second income for me.

DH and I (both 40) have kept £30k in stocks and shares since we were early 30s. With another £30k in savings accounts and another £20k in a high interest business savings account. I completely agree, I wish I'd opened a stocks and shares ISA in my early 20s!

I have premium bonds, and ISA, and some cryptocurrency (which I can afford to lose, I know that's a risky investment).

I don't have as much invested as I would like, but times are hard and everything just costs so much!

Stocks are generally going down at the moment so if anyone wanted to buy now is a good time

Yes. I put a couple of hundred in cash savings, and the rest in stocks and shares each month.