Is it worth putting money in stock market?

[Touty]

I keep reading about people getting great returns eg from s&s isa. I am scared to put money into stock market as can’t afford a loss, so for many years I’ve just had cash sitting in savings accounts at about 4 percent return.

should I start investing in stock market for greater returns?

If you can’t afford a loss, honestly it’s probably not for you. S&S returns on average are significantly higher, but they can be volatile so you have to be prepared that sometimes you will have made a loss, and in general when that happens the best advice is to leave the money invested, when it may recover - if you are loss averse and take it out when you see the numbers fall, you will crystallise that loss.

All this means - you should only put in money that you could afford to make a loss on, you should aim to leave it invested
for at least 5 years, and you should stay confident and ride out fluctuations.

I have a high risk tolerance and most of our
savings are in S&S so I’m not at all against them. But your phrasing suggested that they might not be the right product for you. If you think you can manage with just some of your savings being at risk, maybe you could split between cash and S&S? But only if you think you can handle fluctuations along the way.

Why not open a S+S isa today and put a small amount in. £100 would be OK. You could set up a direct debit for adding £25 a month if you like. Keep it all small so it's not scary. Use it as an opportunity to get experience and understanding of investing and of riding out any short term volatility. Look at the percentage growth and compare to your cash savings. You'll gain confidence to make your own choices about how much of your savings you feel comfortable investing. I would always keep an emergency fund of a few months very basic living costs in cash though so that you never have to take money out of the stock market when it's dipped, but have the freedom to wait until it recovers

Several apps, like Trading 212 let you play around first with fake £££. See if that makes you more comfortable? Personally I think having some cash ISA is good, but most of mine is stocks. Look up John Bogle and just go with a very conservative investment strategy like his. The main trick is not to panic and sell if it goes down a bit. Overtime stocks rise, and with the right mix of trackers it's hard not to beat any cash ISA rate.

Why do you want to invest? If you're scared of losing money and can't afford any loss, I think stock market investments are not for you. These always involve some risk and volatility.

If you want to dip your toe in the water, investments with slow and steady returns might be more suited to your risk-averse temperament and situation. Overall these are likely to provide a lower return than stock market investments over the longer term, but perhaps a little higher than savings rates. Allocating a small portion of your savings into a low volatility portfolio, with investments such as money market funds, bonds and a small percentage of equities would likely be a lower risk option to see how you get on.

This is what ive done. I invested £100 and pop the odd fiver in when i think about it as ive not experience of stocks and wanted to experience it before making any actual investment. I enjoy it but im not confident enough to put real money in at the moment.