I am sure, like me, you keep hearing about how bad the economy is
at the moment, and how poor interest rates are on savings, but how high
they are on debt. Banks do not seem the safe money-keeping houses they
used to be, so people are looking for better things to do with their
money, and I don't blame them! Most working adults by the time they are
30 will have either just started saving, or have a substantial amount
saved for a rainy day. This money at the moment seems to just be sitting
there, yes it may be safe, but it is not getting bigger! I have been
exploring ways to get my money working for me, and here are some of the
best and most simple options I have found.
Investing money you
already have is a bit of a gamble (but not gambling, I am assured),
stocks and shares fluctuate depending on the market so it is not easy to
predict. There is not a set limit to the amount you can start investing
with, £5 a week will gradually show you a return. You can invest in
stocks, where you are buying a share of the company, so you also get a
share of their profits (dividends). The value of these fluctuates and
does not guarantee you any return, but can potentially offer the highest
out of any investment, so it is whether you want to take the risk. Or,
if this is too speculative for you, bonds are the traditional
alternative. There are different types (treasury, agency, corporate,
depending on the institution you are buying them from) and they give you
a fixed amount of interest on a fixed date. Here you are lending money
to that institution, and they give you interest on that amount and
eventually pay you back in full. This sounds quite scary so I have left
it well alone, but as the results can be so rewarding, you may take your
chances!
An ISA account is a savings account where the interest
is tax exempt. You can opt for a stocks and shares ISA where you can
invest your money in shares or investment funds with a limit of £11,280.
Here you encounter the same risks as above, by dealing in the stock
market. Or you can choose a cash ISA option which limits you to only 50%
of this. Different accounts have different terms and conditions, so
some may only offer you tax-exempt interest until you withdraw money,
and permit you to transfer between accounts, while others do not. It is
important to shop around and see which account works best for your
needs. This is a valuable option if you are quite efficient with your
money and know your financial stuff (this is not me!).
This is
like a savings account with no regular interest, but acts as more of a
lottery where every month cash prizes are drawn. You can win between £25
and £1 million, or nothing at all. This option is a bit more fun in
that it's like a game, and the amount you pay in (multiples of £100 a
time) stays the same regardless of how much you win, so you can withdraw
it whenever you like without loss. Having had some of these for years I
would recommend them as a safe option, but if you are anywhere near as
unlucky as I am (I have only won £200 once in four years!), you may want
to take the risk for a bigger return, or just invest as much as
possible to increase your chances of a big win, without any chance of
loss.
Letting a property
is a big investment, but it also has a big return. Obviously it depends
on just how big those savings are that you have, but with rent prices
climbing very quickly you can expect a minimum of £1200 a month for a
four bed house in certain areas, which is isn't bad is it! This does not
necessarily have to be a huge hassle either, letting agents work as a
go between for you and the tenants and it is their responsibility to
manage the property, contracts and rent so you do not have to lift a
finger if you do not want to! As popular as this is for many, it
completely depends on just how much you have saved. For me, this one may
have to wait a while!
No comments:
Post a Comment