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What to invest in?

Former MemberFormer Member Posts: 1,876,324 The Mix Honorary Guru
I'm currently in the fortunate position of having quite a bit of savings stashed away, and am managing to add at least £750 (usually nearer £1000) a month to that.

I'm just wondering where i can invest some of my money to get a higher return than the pityful amount you get in savings accounts these days.


Aside from what i have in my savings account i have some money in a standard ISA, then i have some in a 1 year fixed rate ISA, then some more in a 3 year fixed rate ISA, and then also have, and am continueing to buy shares on a monthly basis (these are brought out of my wages in addition to the savings i put aside that i mentioned above)


I'm going to look around for a better paying savings account, and am going to move my general ISA for a better paying one, but i was just wondering if anybody had any suggestions as to where else i can invest money to achieve a better return - I know the level of risk generally equates to the level of return you get, so i'd like to point out i want pretty low risk, which is why i've essentially stuck to the ISAs route to now.

Comments

  • Former MemberFormer Member Posts: 1,876,324 The Mix Honorary Guru
    You don't say what you do or how much you've saved but have you considered property? That way, when whatever gravy train you've found yourself on ends you'll still have something to show for it. People in the finance/investments business lose as often as they win, it's a gamble. Property is a lower risk, and at the rate prices are dropping at the minute you may make a killing.
  • Former MemberFormer Member Posts: 1,876,324 The Mix Honorary Guru
    I have a feeling that some people will mention Premium Bonds later on in this thread. Reading previous discussions on TheSite.org, it appears that most people makes 10% in a year. E.g. if you have £500 in bonds, your balance will be £550 next year. In contrary though, I had £500 in bonds for 3 years between 2006 and 2009 and I didn't get a sausage. So yeah, bonds might not be your best bet.
  • Former MemberFormer Member Posts: 1,876,324 The Mix Honorary Guru
    Most people with bonds are ok, however some people will find that their money effectively loses value!
  • Former MemberFormer Member Posts: 1,876,324 The Mix Honorary Guru
    If you're willing to do a bit of research stocks and shares are probably the best return - though you need to be careful as some will half your money overnight and others will double it...
  • Former MemberFormer Member Posts: 1,876,324 The Mix Honorary Guru
    Thanks for the replies so far, property is something i've considered for a while, i've seen a couple of places around here for about £60k, obviously very modest, bottom of the ladder places, but then i've seen a few very nice 2/3 bed semis in a pretty nice area for about £120k, the latter being somewhere i would happily live in rather than just buy hoping to sell on, so in that sense i guess i couldn't lose, i either make a tidy profit or have myself a nice house.

    I've currently got about £25k in various savings/isa accounts, then at the moment about £5k in shares (well that's the price that i paid, at the moment they're about a third higher.)

    I was going to throw £2/3k in BP when Obama was using them as a opinion poll boost and their value had plummeted, but never got around to it and now they are heading up again, might still be worth while, but i think the time for the free money to be made off their back has for the better part past
  • Former MemberFormer Member Posts: 1,876,324 The Mix Honorary Guru
    Go and see your bank. I'm in a similar position regarding savings and how much I've got squirrelled away.

    Basically I'm going for investment funds, of varying risk and return, with the large whack that will eventually be a deposit in a 4-year fixed term bond. ICICI currently have the best rates according to t'interweb. Also doing SAYE option scheme at work.
  • Former MemberFormer Member Posts: 1,876,324 The Mix Honorary Guru
    Monserrat wrote: »
    Reading previous discussions on TheSite.org, it appears that most people makes 10% in a year.

    I really doubt it. If you can show me where that investment is, I'd be very grateful. 10% p/a is unheard of, unless you're ploughing it into equities.
  • Former MemberFormer Member Posts: 1,876,324 The Mix Honorary Guru
    Housing/property is not always good.
    Interest rates will rocket soon so you have to be wise about mortgages etc.
    I'd say silver.
    Gold is going to keep climbing but then collapse totally.
    Silver usually follows gold up and down but not this time.
    Silver is the safest bet on the planet and I've put my money where my mouth is.
    Sooooo ...if I'm wrong ...I'm wrong publicly now.
    Americas economy is about to go over the cliff ...in fact as far as I'm concerned it already has but it's being masked right now.
  • Former MemberFormer Member Posts: 1,876,324 The Mix Honorary Guru
    If gold did tank, it would be the first time in history.

    I don't think interest rates will rise for a while because of the fear of us regressing back to recession. They will rise soonish though as a growing economy and low interest rates is unsustainable.

    My bet? Dragon and EMEA equities for the short term, UK equities and gilts in the medium term.
  • Former MemberFormer Member Posts: 1,876,324 The Mix Honorary Guru
    Monserrat wrote: »
    I have a feeling that some people will mention Premium Bonds later on in this thread. Reading previous discussions on TheSite.org, it appears that most people makes 10% in a year. E.g. if you have £500 in bonds, your balance will be £550 next year. In contrary though, I had £500 in bonds for 3 years between 2006 and 2009 and I didn't get a sausage. So yeah, bonds might not be your best bet.

    Bonds used to be good, but the value and frequency of prizes has reduced lately. If you have £10k or more (£30k is the limit) you can still do well, but the trick is to hold consecutive numbered bonds, so it is best to invest a lump sum all at once. Remembering that the draw works pretty much like the lottery, small sums like £500 have very little chance of winning.

    Adding £750 per month would result in numerous small blocks of bonds which, if it were me, I would cash in and consolidate periodically to increase my chances.
  • Former MemberFormer Member Posts: 1,876,324 The Mix Honorary Guru
    If gold did tank, it would be the first time in history.

    I don't think interest rates will rise for a while because of the fear of us regressing back to recession. They will rise soonish though as a growing economy and low interest rates is unsustainable.

    My bet? Dragon and EMEA equities for the short term, UK equities and gilts in the medium term.

    from what i'm aware, gold goes on occassional monster increases and then drops and plateaus for quite long times, so unless you're really ahead of the curve i wouldn't bother since it's value is mainly driven by governments....

    depends on how long you want to invest for, and how often you want to change your 'portfolio', long term capital value with occasional good yearly income only comes from stocks and shares since they're productive, but if you want a gradual return then government bonds and extremely large companies that won't grow a lot more % wise but will return steady yearly profits is good

    property values are mainly dependant on mortgage lending so yeah you may see your investment but it's value is dependant upon lenders mainly, which i wouldn't be too optimistic about cause of tightening of credit

    personally if i actually earned enough to save well, i'd invest in a commodity good which is finite and useful like phosphate, or food or something ie futures

    my current thought in regards to bigger picture is that the current government is going to try and inflate their way out of their borrowing commitments, raising goods cash value and devaluing debts and keeping interest low, which is why i'm thinking commodity goods, look at the price of bread in past year....

    ps - all over the shop i know but i didnt really have time to edit nicely
  • Former MemberFormer Member Posts: 1,876,324 The Mix Honorary Guru
    I really doubt it. If you can show me where that investment is, I'd be very grateful. 10% p/a is unheard of, unless you're ploughing it into equities.

    I got it off the top of my head, then I did a search to try and find out where I got the figure from. It was from this thread.

    The quote that I remembered was:
    kangoo wrote: »
    i have £500 and i won £50
  • Former MemberFormer Member Posts: 1,876,324 The Mix Honorary Guru
    Some interesting ideas cheers people.

    Gold is something that i've thought of too, but as someone pointed out you need to be ahead of the curve and by the time i thought about it, it was getting lots of publicity about being incredibly high so i put that on the back burner.

    Regarding the risk and time scale, i like the idea of having instant access, but saying that my savings have been building up for 6 / 7 years now, so i obviously dont need access to it all, and regarding risk, relatively low, although i dont mind putting small amounts in something thats a larger risk.

    At the moment i feel i've somewhat spread my risk and savings around, several thousand in a standard ISA that i can draw out at any time with no loss of interest, then several thousand split between a 1yr fixed rate and a 3yr fixed rate ISA, the latter offering double the interest, but obviously tied in for that period. Then several thousand in stocks which is through my work, so got them at a heavily reduced rate and if they fall below what i brought them for at the end of the 3 year period i get my money back with a small rate of interest 0.5% i think (which at current levels is better than most current accounts!) and obviously if they rise (which they have so far) i get whatever they are worth, so literally cannot lose, and as such am putting in the maximum allowed amount each month.


    Regarding property, morrocan roll, i know you say its not always good, and you're right, which is why i think i'd only go down that route if it was a property that i'd want to live in anyway, so even if it did lose value (which is pretty much only a short term thing anyway) then it wouldn't really be an issue, as it wasn't just brought to make a quick few quid

    I think i'll have a look in to Gilts, heard about them but never paid much attention to be honest
  • Former MemberFormer Member Posts: 1,876,324 The Mix Honorary Guru
    Gold is, unless you can predict the peaks and troughs, more of a defensive holding than something you can actually make significant and regular profits on. Their value is relatively unaffected by the world markets and economy. It's quite odd since it's both a commodity and medium of exchange.

    Gilts are government stock, issued by the Debt Management Office, which is executive agent of HM Treasury so they're 100% guaranteed. While you're not going to get spectacular returns, your capital, at least in nominal terms, is completely secure. Gains on gilts are free from income tax and CGT (Capital Gains Tax).

    Monserrat - premium bonds are different. They're administered by National Savings & Investments, again, backed by HM Treasury so 100% secure. Their return is around about the 2-3% mark off the top of my head, but they offer you the chance to participate in their monthly prize draws, with the chances of winning increasing depending on how much you have invested. The person in that thread won £50 on a £500 investment, which, though technically is a 10% return, this is not guaranteed. Furthermore, if they'd had £5k invested and won £50, it would only be a 1% return, which is piss all. Off the top of my head, I think NS&I products are also exempt from income tax and CGT, but don't quote me on that - I think some are and some aren't.

    You will also have to bear in mind that any gains you make on investments will normally be liable to income tax and / or CGT. Some have tax deducted at source for basic-rate taxpayers so if you're a higher-band tax payer, you'll need to do self-assessment on the rest (there are some quite generous CGT thresholds, plus losses can be carried forward each year).

    Orange, as I'm not FSA Authorised, I can't recommend specific products. I would shop around and book an appointment with your bank. They can advise you more about what's out there and what they can offer you. Once you have an idea what's on offer, you can then look at other providers. You can of course go to an Independent Financial Adviser who can recommend from a range of providers, but of course, they'll charge for the advice, whereas your bank won't.
  • Former MemberFormer Member Posts: 1,876,324 The Mix Honorary Guru
    Orange, as I'm not FSA Authorised, I can't recommend specific products. I would shop around and book an appointment with your bank. They can advise you more about what's out there and what they can offer you. Once you have an idea what's on offer, you can then look at other providers. You can of course go to an Independent Financial Adviser who can recommend from a range of providers, but of course, they'll charge for the advice, whereas your bank won't.


    Before i set up my fixed rate ISAs i popped in to my bank and she basically said she wasn't allowed to offer me advice, or say weather or not they expected interest rates to rise or fall etc... but gave me plenty of info on all the accounts that they offered and i went away and compared with other banks / building societies, but she made it clear she could only give information on their accounts rather than any advice or opinions

    I think the visit to a financial adviser could be pretty beneficial actually :thumb:
  • Former MemberFormer Member Posts: 1,876,324 The Mix Honorary Guru
    Mr Orange wrote: »
    Before i set up my fixed rate ISAs i popped in to my bank and she basically said she wasn't allowed to offer me advice

    If you book in to see an advisor, then she will be authorised and thus will be able to give you advice - I did the very same thing last week and came away with a bunch of literature. She did a full hour-long assessment of my finances (not a euphamism) and I've now got a much fuller picture of the options available to me. I'm still mulling them over, but it's much clearer.
    Mr Orange wrote: »
    or say weather or not they expected interest rates to rise or fall etc...

    Probably because she's not on the Monetary Policy Committee :D
    Mr Orange wrote: »
    I think the visit to a financial adviser could be pretty beneficial actually :thumb:

    As I said, the IFA can give you advice about products from all different banks / building societies / unit trusts / OEICs / investment funds etc. etc. from the marketplace, rather than just the options available from one bank. Having never been to an IFA before I can't say for certain, but if they don't charge you for the advice, they'll take a commission of whatever you decide to purchase.

    But as I said, I'm not authorised to recommend anything, either specific or general, as I work in financial services, have a good knowledge of what's out there, but am not authorised to give advice - I can only answer questions about the features of generic products.
  • Former MemberFormer Member Posts: 1,876,324 The Mix Honorary Guru
    Gold is, unless you can predict the peaks and troughs, more of a defensive holding than something you can actually make significant and regular profits on. .

    Theres an old saying ...Gold is a protecter of wealth while silver creates wealth so your right about it being a defense.


    It's the perceived worth of paper money or even copper and iron money that makes gold appear to rise and fall .
    A little story ...

    An ounce of gold would buy a Roman senate member 2,000 years ago ...a very fine suit of clothes and.a very nice quality pair of shoes.

    An ounce of gold a hundred and fifty years ago would buy a business man a very fine suit of clothes and.a very nice quality pair of shoes.

    An ounce of gold in 2010 would buy you ...a very fine suit of clothes and a very nice quality pair of shoes.
    So for two thousand years ...an ounce of gold has retained it's value ...the rest is mostly illusion.
    If It's five hundred pounds an ounce or two thousand pounds an ounce it is reflecting the worth or the worthlesness of the paper notes in your pocket.
  • Former MemberFormer Member Posts: 1,876,324 The Mix Honorary Guru
    Here's an email I got today ....




    Dear Subscriber,


    Look at the headlines: Populations are exploding. The environment is stressed to the max. Massive climate changes, whether natural or manmade, are accelerating. Disasters are hitting with alarming regularity.

    We’re witnessing one giant global game of “survival,” operating under the same dynamic you see after a hurricane, flood, or earthquake.

    Every person and every nation is clamoring to get their piece of the natural resource pie. They’re desperate for fuel. They absolutely MUST have water. And for ultimate security, they rush to gold and silver.

    Not surprisingly, as inevitably occurs in any disaster zone, that means these natural resources — the building blocks of lives and societies — are getting more valuable.

    China knows this. India knows this. And yes, the U.S. knows it as well.

    That’s why you’re seeing giant mergers and acquisitions among companies that produce natural resources, such as miners ...

    It’s why rich nations are jockeying for footholds in multiple commodity-rich regions of the world ...

    It’s why many natural resource firms are increasingly flush with cash ...

    And that’s also why I’ve been busy hand-selecting natural resource companies that not only have the ability to surge in value in the months ahead, but that also pay out big fat cash streams to investors. For details on the companies I’m recommending right now, just click here.

    Best wishes,


    Sean
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