Advice for safe but growing investment of £2000

[wakingfire]

I've got £10,000 in savings, a few things I need to spend it on this year, and with careful planning I will end up with £10,000 by the end of the year.

I'm thinking I now need to do more than be frugal if I want my money to grow.

Would someone be able to recommend what I could do with £2000 to see some movement in a year.

I am recently divorced, not agreed finances yet, but I am aiming to be more knowledgeable about managing and growing my money by the time we agree the finances.

Thanks in advance!

Gold could be worthwhile. Maybe Etherium but you'd be taking a risk. I'm fed up with poor returns on savings hopefully someone will come on the thread and give us a hot tip!

Gold and Etherum are ridiculously high risk suggestions.

You get higher returns with higher risk, so when you say 'safe' it really depends what you mean. Cash deposits or Premium Bonds are the lowest risk, but if you are prepared to risk the capital you could look at investing in a funds through someone like Nutmeg. Funds are considered lower risk than individual shares or bonds because they diversify their holdings, so it is unlikely a single catastrophic event would wipe out your savings.

Thanks for the advice on Nutmeg. I will look it up. Yes I'm happy to invest in a fund and reasonably ok about risk as at this stage I'll only be dealing with £2000 and keeping the rest of my money in savings.

On a related note would people mind sharing what website, blogs or magazines or books they read to keep up with investing and growing their money?

I agree that Gold or Etherum are high risk. Cash or near cash is safest but returns are negligible at the moment.

If you go with a fund, the investment platform you choose will provide further info on risk levels so you could choose a fund that’s a mixture or cash, bonds and stocks to minimise your risks.
However, like PP explained ‘no risk, no gain’ so it’s balancing out the level of risk with the level of gain. Eg a savings account will be eg 1% but it’s protected so you won’t lose anything (other than the fact inflation is higher than interest). Things like Etherum or similar might make you 50% but might lose you 50 or 90% too. So it’s about choosing your sweet spot.

If you go down the stocks and shares ISA route, make sure it’s not money that you might suddenly need - those funds make money over time but they fluctuate up and down along the way so not always a good idea to withdraw money randomly.

It depends on how long you want to invest for. Long term the safest stocks are things like Nike, Boeing, Coca Cola, Heinz. But there is supposed to to be a slump or crash this year or next (maybe have already happened earlier this year if you remember but I think that wasn't it).

Thanks for the advice. Nutmeg looks like a good platform.

I could easily do a medium-high risk fund for 10years starting with £2000 and putting in £100 per month. Wouldn't make me a millionaire, but would hopefully grow more than savings.

Do you think that is more sensible than a LISA, or is that something I should do too?

Currently have £5000 in an ISA and £5000 in standard savings account

Yes they are risky hence why I said op would be taking a risk. I hardly think my suggestion was ridiculous given she said she wasn't investing her whole pot, nor did she say in her op she was risk averse.

If you have a mortgage and can pay off a lump sum without penalty, pay that first - you're effectively earning about 5% in interest you don't pay.

If you don't and aren't likely to need the cash in a hurry, Lifetime ISA is good. You can invest in a LISA through Nutmeg. Otherwise, put as much into an ISA as you can - may not be much advantage now, but as you build a pot up, it becomes more worthwhile.

Lifetime ISA has the benefit of the bonus from the government but the disadvantage of losing the bonus + 5% if you withdraw the money before retirement. You can invest in exactly the same stuff whether it’s ISA or LISA.
If you go with medium-high risk, make sure you can cope with things going down by 20% in a bad year.

Gold or etherum wouldn’t be my choice for a beginning investor either. Have a look at the monevator website that talks about passive investing through low cost global trackers.

You need to be aware of your attitude to risk. Is a 10% drop ok in the short term, 20%? 50%? You need to be clear what you’d be able to tolerate. I’m still learning about my attitude to risk. I thought I was quite risk tolerant but seeing one of my funds down15% has been a bit of a shock. I’m ok with it for now as I have time for it to (hopefully) recover and am putting in more cash while units are cheaper (also were only talking hundreds not thousands). I’m not yet sure how much further drops I can tolerate before I stop putting in money.i have learnt though I’m likely to be better at coping with risk while I’m growing money than once it’s accumulated.

I’ve made quite a few mistakes starting out and am still learning.