Why invest?
In theory, investment means you could earn more from your money than if you just kept it in a savings account. If you pick the right shares, funds or other type of investment, the returns can be very high.
However, investment means introducing risk to your money and there is the possibility you could lose some – or even all – of your money.
What should I invest in?
There are all kinds of schemes or “assets” you can invest in, ranging from shares, equities, bonds through to property and art. You can diversify through investing in a portfolio of investments, including different markets, countries, companies and asset type.
Having a mix of different asset types will spread any risk and means you won’t have all your eggs in one basket.
Risk and reward
When you invest you will need to consider risk and reward. Generally, the greater the risk you take with your money, the greater the potential for growth.
Before investing you need to think about how comfortable you are with the potential loss. Ideally you should have cash for emergencies before you begin investing in anything else.
Monitoring and managing your investments
If you invest in a fund, the fund manager will send you an annual report on the fund’s performance. You’ll also be sent written statements at regular intervals.
There are various online services that allow you to take an active role in selecting funds and let you view, manage and monitor all your investments in once place.
An independent financial adviser can help you choose, monitor and review your investments
Dealing with problems
If you invest using a firm authorised by the Financial Conduct Authority (FCA – previously the Financial Services Authority), you get protection if you’re not happy with the service you’ve received.
FSA Authorised firms must have formal complaints procedures and belong to the Financial Ombudsman Service (FOS), which resolves disputes between a firm and its customers.
It will also mean that if the firm goes bust you could be entitled to compensation from the Financial Services Compensation Scheme (FSCS).
Contact us
For assistance in all the stages of investing contact the team at Platinum