Investments?

[mickey house]

Originally Posted by tspill

Sorry, but this is completely skewed and scare mongering.

Proper and sensible investing is NOT anything like gambling. However, there is risk. But there is inflation risk with savings.
And to be honest, it is little to do with luck (if done properly).

Properly risk assessed and diversified investments are excellent long term financial instruments. These are the keys to successful investing. As I said in my earlier post, look at the sequence of returns in history. TBH, these days it isn't rocket science as the information is available in easily accessible forms that the vast majority will understand.

Those that have lost in workplace scenes have clearly not understood what they are getting themselves into. In my opinion, investing in single company shares in madness unless you exactly what you are getting into. This in my view is "gambling". Single asset in a single class - TOTALLY undiversified. I have been lucky to make a lot of money in share saves, but I sold immediately the shares matured - before the cash alternative expires - so zero risk. I know many why held on and lost a fortune. They simply didn't understand what they were getting into.

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Accepted that perhaps the term 'gambling' is inappropriate, but as you agree 'risk' is the correct choice of word (risk in the investment context meaning the possibility of loss).

Good luck to people who want to 'risk' losing their money, but I won't be risking mine.

[tspill]

Originally Posted by mickey house

Accepted that perhaps the term 'gambling' is inappropriate, but as you agree 'risk' is the correct choice of word (risk in the investment context meaning the possibility of loss).

Good luck to people who want to 'risk' investing their money, but I won't be risking mine.

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Yes - there is financial risk. And that is the key - understanding your personal tolerance to risk.
IFAs, if used will ask a load of questions to identify this (usually a risk score between 1 and 10).
I for example know I have a very low tolerance to financial risk (most IFAs would say too low for my age). I invest accordingly.

But as I say, cash (savings) also carries guaranteed financial risk in that is is guaranteed to lose money; continually. This is OK for a couple of years, but will makes a huge dent on a person's assets longer term. Even losing 1% to inflation for 10 years, there will be a 10% loss (ignoring compounding). Thats £2000 on a £20,000 sum.

Again I say - this is not a short term thing.
So in say a 10 year period, savings are guaranteed to make a say 10% loss. A sensible investment would almost certainly make significant increases (even through a crash like we saw a decade ago or the tech crash in 2000). Most investments recover from significant drops in 18 months (historically).

Reflecting your final comment - Good luck to those guaranteed to lose money in savings. 100% risk.

[mickey house]

This is from Martin Lewis's website:

An investment – or investing – is a long way from putting your cash in a bank account where it sits to earn interest. An investment is a gamble: instead of the security of guaranteed returns, you're taking a risk with your money. The hope is that you make a lot more than you put in (a juicy profit), but there's the possibility you end up with less (a nasty loss).

[Mr Tom Morrow]

Originally Posted by mickey house

Accepted that perhaps the term 'gambling' is inappropriate, but as you agree 'risk' is the correct choice of word (risk in the investment context meaning the possibility of loss).

Good luck to people who want to 'risk' losing their money, but I won't be risking mine.

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That's me! No way am I taking any type of risk with my money. When in work yes we took a gamble on jobs but nothing that would drive the company under.

It's my money and the biggest risk I take is Premium Bonds and they are only a 'risk' if they don't pay out as you can still get your money back albeit eroded by inflation.

When I retired I went to see the Investment Manager at NatWest (free service). We spoke for 2 hours and he declared me risk averse regarding savings and gave me excellent advice most of which wasn't for NatWest products!

I can live with normal ISA's and Bonds. Any issues I get my money back plus interest but I do know that the true value is eroding. Hey ho that's life.

[tspill]

Originally Posted by mickey house

This is from Martin Lewis's website:

An investment – or investing – is a long way from putting your cash in a bank account where it sits to earn interest. An investment is a gamble: instead of the security of guaranteed returns, you're taking a risk with your money. The hope is that you make a lot more than you put in (a juicy profit), but there's the possibility you end up with less (a nasty loss).

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Another skewed and oversimplified statement. Exactly what I would expect from ML.
Those considering investment need to research it properly and one line statements like the above cost people a LOT of money. Often life change amounts if looking over decades.

ML is the last place I would go for information on things like this. Some of what he writes is frightening.

[tspill]

Originally Posted by Mr Tom Morrow

That's me! No way am I taking any type of risk with my money. When in work yes we took a gamble on jobs but nothing that would drive the company under.

It's my money and the biggest risk I take is Premium Bonds and they are only a 'risk' if they don't pay out as you can still get your money back albeit eroded by inflation.

When I retired I went to see the Investment Manager at NatWest (free service). We spoke for 2 hours and he declared me risk averse regarding savings and gave me excellent advice most of which wasn't for NatWest products!

I can live with normal ISA's and Bonds. Any issues I get my money back plus interest but I do know that the true value is eroding. Hey ho that's life.

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Did your advisor discuss "structured products" with you?
These are like a half way house where your capital is guaranteed, but if the stock market index (e.g. FTSE 100) increases at all, you get a guaranteed return.
I have one I took out nearly 5 years ago (with Investec) - pays 4.7% if the FTSE 100 is higher than 90% of its value when I started the plan. I have made that 4.7% every year so far. The only risk is not getting the yearly return - which isn't a big deal given interest rates are so low anyway.

[tspill]

Originally Posted by bonnies mum

We did have 1 of these type of products and made a nice profit after cashing it in after 5 years (min term). And have done ok on other investments.
Now retired I just want security - and yo have my £ on hand should we decide to move house which we may.
I'm just

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The ones I have are also five years. Two different types. One was a "kick out" that was a higher return, but after three years, the first year I received the income, it matured. So this ended up only being three years.

[Wheelbrace]

Ask in your own bank if they have a Wealth management dept, you’ll find that they probably do, chat to them. In my last few years mine are probably averaging 10-13%. (Moderate Risk)
If you want safe you could get a PRU this will get you 5-6% on approx 100k of investment

[Pumba75]

Originally Posted by mickey house

This is from Martin Lewis's website:

An investment – or investing – is a long way from putting your cash in a bank account where it sits to earn interest. An investment is a gamble: instead of the security of guaranteed returns, you're taking a risk with your money. The hope is that you make a lot more than you put in (a juicy profit), but there's the possibility you end up with less (a nasty loss).

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The thing with Martin Lewis is that he actually doesn't know quite as much as he likes people to think he does. This is just another example.

He regularly says things that are misrepresentative and often just downright wrong. Honestly, if an authorised IFA did or said some of the things he has over the years they would be subject to sanction by the FCA.

On some things he is quite good - general money saving etc, but he should stay well out of things that sit in the regulated financial services arena as he plainly doesn't understand.

[Pumba75]

Originally Posted by tspill

The ones I have are also five years. Two different types. One was a "kick out" that was a higher return, but after three years, the first year I received the income, it matured. So this ended up only being three years.

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When investec started doing these about 10 or so years ago, the headline rates were about 14/15% - used to use them quite a lot with clients.