How can I turn £16000 into more?

SunnySusie

Franchise seems a good options. Else there are the usual investments - trackers, bonds, etc.

Gold
Gold is interesting, it's funny now that we are at a peak and only now everyone is getting excited about it. It's ironic how human nature leads us to invest at the top - it just feels safer. Yet there is much further to fall now. As Buffett once said "be fearful when others are greedy and to be greedy only when others are fearful" and "The investor of today does not profit from yesterday's growth". etc. It's always fun reading Buffett quotes.


Shares
Please stay clear of gurus offering to double your money etc and end up charging a fee for their course. They won't tell you anything that you can't read for yourself for free on the Internet. Or if you want the info nicely consolidated then then spend a tenner on a book!

I wonder if fee charging gurus are rich because they are good at persuading people with some money in the bank to part with it and not because they are good at what they claim they can do? I always think, if you are so good at this, why do you need to make your living from selling courses! I make extra cash though web based affiliate marketing - and am happy to give away the info I have learnt for free! I simply don't need to sell it lol!

The problem with stocks and shares is that to make money you need to find shares that are miss-priced. This is notoriously difficult to do as efficient market theory ensures that shares are sold at the value they are worth. If a company is likely to do well in the future, this will already by built into the price you pay for the share. This doesn't mean shares are a bad way to go, what it does mean is that you have to work very very hard to beat the market. ie to win you need to make more money than you would have done just by investing in a tracker fund.

For example, a friend of mine self selects. Spends hours and hours a day researching, trading and investing. I asked him how he has done so far this year... he said he'd done great. Making about 30% off the back of 100s of hours of work. I didn't have the heart to point out my tracker fund (total time invested 10mins online) had done just as well - or even better- and cost me no time and no effort! In the mean time I've spent 100s of hrs building websites that will provide a passive income for many years to come.

Self select shares because you enjoy the challenge, its a nice hobby and I do actually buy a few in small volumes. But if you are looking to invest a larger amount in shares - go for a tracker. Just have a look at managed funds vs. tracker performance. These are run by full time professionals who live and breathe investing yet half of them fail to beat the market.

Houses
Oh boy, more Buffett quotes.. "Price is what you pay. Value is what you get." - buy a house because you like it and want to live in it. Then you can't go wrong.

"I never attempt to make money on the stock market. I buy on the assumption that they could close the market the next day and not reopen it for five years. " and "Our favorite holding period is forever.". So again, buy because you like and believe in what you have bought.

Fulham_Mark

There's a true story about the head of a huge bank in the US back in the 1930s, he gets in the lift one day and the attendent starts telling him what shares he should buy. The banker suddenly realises that the whole stock-market is being inflated by amateurs piling in money on the advice of other amateurs.
The banker his entire portfolio, a few weeks later the wall street crash takes place and all the amateurs are wiped out.

Never invest if you're getting advice from the "elevator man".

I have a book called "Where are all the customers' Yachts?". Boy and his dad are walking through a harbour in Boston, the son asks who the yachts belong to, the Dad says they belong to investment bankers who make lots of money by investing their customers savings. The son asks "so where are all the customers' yachts?" Good question....

Speak to some people who went on "become a property millionairre" courses a few years ago to find out who really go rich from it.

I'd find someone you know over 50 who has an amazing track record of making good decisions on money and copy them.

marsden_pete

have you thought about the share sectors that are struggling at the moment? like banks and housing? these sectors will recover again but you are looking at a medium to long term investment.

thebigdipper

This whole thing is so strange. For every person recommending one method there seems to be someone else warning against it. However I thank you all for the suggestions.

Investing seems too risky, although the tracker fund seems the best choice should I decide to go with investing.

justjohn

Most of the ideas are good just depends on your knowledge/skills and how much risk you are willing too take.

moneysavingexpert79

thebigdipper wrote: »

Hello all

I am currently unemployed (having left my previous job to travel Europe with a friend) and I have £16000 in a savings account which I'm happy to leave in there. But...

I was hoping to ask if anyone has any ideas/suggestions of ways in which I can use this money to make more of it. I'm open to any ideas, no matter how risky or whacky (but of course more realistic and sensible ideas would be appreciated)

Go to zopa.com and you will find info on and it will allow you to lend money to other people. It lets you determine how much you set the interest at and how risky the people you lending to are. I always thought to myself if I ever did have any spare cash, that's how I'd use it.

savemoney

I Love Jewellery all your posts are the same, I can see your intention is though in your 3rd paragraph

"I am now looking for team leaders to recruit their own sales force of party planners"
"If you want more info then just let me know........"

Reported to abuse

JohnC1977

Invest in a small starting business?

Al_Silverstein

Ok, so you have to remember that whatever you do - its a risk.

Leaving that money in savings account earning say 3% percent interest - what is the 'real' rate of interest you are getting, it is 3% less the current inflation rate which may at the present time be negative. This is one of the reasons gold is doing so well at the moment, it is protection from these negative real interest rates.

So leaving in a Sterling denominated savings account leaves you open to inflation risk, Sterling devaluation risk, risk that the bank may go under - you are ok, you have less than the £50k limit which is guaranteed by Govt in the case of bank failure.

Solution wise, you need to maybe spread your risk across asset classes, ETFs are very good at this and low transaction costs typical 0.5% per annum.

So you could say leave £5k in cash, should you need to get your hands on it quickly, £5k in ETFs, lots of choice, ETF Securities have v.wide range - you could choose an FX one, basket of currencies, commodities one broad based (eg etfs all commodities , general so you are not exposed to any one commodity. The remaining £5k you could use to start a small business, maybe simply selling a single type of item on ebay, depending on your interests - we all need avocations now as well as our working 9-5 occupations, a part time income starting really small, in 5-10 years you could have a nice safe income each month with a low risk idea. Of course you'll need to base it on your own interests and skills but everyone has unused talents.

I wouldnt advise spending large sums on seminars or the like - just start small, and learn as you go along, the money can be used for stock to sell, but again keep a lot of that powder dry until you know what works and what sells etc, then roll it out.

Overall you need to consider not just return on capital, but return of capital... in these times of unprecented low interest rates and quantitative easing, your £1 now may be worth considerably less, and buy much less in 1,3 or 5 years time. Buying real assets that will not depreciate, especially if you have an expertise in an area is the way to go. Of course, if you have any debts, that money will be best put to use paying it off first.

Also a warning, asset prices are increasingly volatile and the stock market is due a nasty correction sometime in the next 6m-1year despite recent run up. My skill is trading so it doesnt matter if it goes down, money can be made either side of the market, but it is not the time to buy and hold - in my opinion, not a recommendation!

Regards
Al