Home Property GuidesProperty Insights & Advice Is now the right time to invest in stocks and shares?

Is now the right time to invest in stocks and shares?

by John Saunders
27th May 22 10:00 am

Never has it been so important to start thinking about your financial future. Retirement ages continue to rise and rumours abound of a pension grab by the UK government, potentially wiping out years of savings.

Add to that an uncertain economy, still recovering from a worldwide pandemic, and noting that the war between Russia and Ukraine has hit the global economy hard, and it’s difficult to know if you’ll have a job to create a pension.

In short, now may be the best time to invest in stocks and shares. However, this isn’t something you should take lightly, it’s a complex market. One wrong trade can destroy your capital.

The best way to invest in stocks and shares

Every type of investment vehicle comes with a standard warning, ‘the value of your investments can go down as well as up’. The warning often goes unheeded as people feel confident that they can outsmart the market. But, the truth is that it’s easier than you think to make a bad trade.

Even experienced investors make bad calls because there are many unknowns when investing.

Thinking about the future may dictate that investing is essential for your future. But, if that’s the cash, you should first consider a stock ISA.

This works like a standard ISA, allowing you to save money every month. But, the funds are invested by a professional with the aim of dramatically increasing your net worth. The funds are shared to reduce risk, making it a smart way to help you achieve your investment goals.

If you want to see monetary growth with minimal risk, this is a great starting point.

Consider property investment instead

However, it’s not the only option. In fact, one of the best options to build your worth remains investing in property. Certainly, there have been some property crashes, wiping out millions of pounds worth of property value in a short space of time.

However, in the long term, property tends to go up in value, making it a sound investment. Just take a look at the rise in the value of Buckingham Palace. Best of all, there is more than one way to invest in property.

Rental properties

The traditional approach is to purchase a property and then rent it out. In effect the tenants pay your mortgage for you, allowing you to purchase the house for very little outlay and at low risk. Once the mortgage is paid you have a house you can sell to generate additional funds.

This is a lucrative market at present thanks to economic issues many people are unable to buy a house and need somewhere to live, rental becomes the obvious option.

Flipping

Flipping means buying a house that needs work, doing the work, and then selling it for a profit. For this approach to be successful you need to create a renovation budget and stick to it. If you’re doing the work yourself it can be physically demanding but ultimately rewarding.

You will be relying on the quality of the work and the natural increase in house prices to make the project worthwhile.

Trusts

For those that are less keen on buying to rent or even flipping a house, then there are trust options. With these, you invest in a trust in a similar way to stocks and shares. The trust handles investment in various property portfolios, reducing the risk and work done by you while, hopefully, generating healthy returns.

Of course, there is still a risk and you can lose all or some of your funds

Final thoughts

The bottom line is you need to take steps today to protect your financial future. The best way to do this is to split the risk, investing in property will usually give you a steady return on your investment.

Mixing this up with the potential reliability of stock ISAs will allow you the opportunity to dabble in the stock market yourself, safe in the knowledge that you can’t lose your entire pension pot.

Whatever option you choose it is imperative you monitor the markets daily to ensure your investment is doing as well as possible. But, remember, the aim is long term gain.

 

The above information does not constitute any form of advice or recommendation by London Loves Property and is not intended to be relied upon by users in making (or refraining from making) any investment decisions. Appropriate independent advice should be obtained before making any such decision. London Loves Business bears no responsibility for any gains or losses.

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