Financial advice is for rich people.

Tirian

EdInvestor wrote:

I'm trying to look at this from the point of view of the general public, not investors.

Well, it seems that doing so you do at least appear to see where I am coming from ..

#it has made borrowing appear cheaper and encouraged a major increase in demand for property which has put prices up massively.This helps people who own already, but harms young first time buyers, who are also the most prone to use easy credit and get into debt.It's probably the main reason for the anger of people like Tirian.

Bingo .. as I said before, I don't have any debt apart from (fairly small) student loans. It's still impossible for me to even get a sniff at buying - and I'm not exactly on poverty wages. I've looked into it quite a bit - even if I can save up a £15k deposit, there's nowhere that would lend me anywhere near enough to buy even a grotty ex-council flat in a high-rise in Hackney. And that's about as cheap as things go.

Then kids started having problems, as uni fees meant they got into debt and high house prices meant they needed help with a deposit.Fortunately BTL emerged as a new thing and parents could raise the basic money to help the student stand on his feet at quite an early age - and perhaps toip up the failing pension as well.

Yeah, cheating a little by throwing in a quote from one of your previous posts .. but glib statements like this are kind of irritating. The emergence of BTL is only "fortunate" for those wealthy enough to take advantage of it - a minority.

There is also a big gap between people who have final salary pensions ( which require no effort and are guaranteed in almost all cases) and money purchase pensions which require investment skills which people are not taught. Many people are basically unaware of the difference and shocked when they discover how little their pension will be.

In this context it is difficult to give guidance. Many people are starting completely from scratch.Is it any wonder they are baffled at the apparent complexity - not to mention the differences of opinion among those who are informed?

My point exactly ... and while I am happy to take on board that I can probably work out most of this for myself, with some research on websites etc., I still completely disagree that this is true of everyone. Financial jargon is hugely intimidating to many people - just getting to grips with things like "equities" is going to drive a lot of people to distraction before they even run into the figures - another major barrier. For some people here, I am sure that working out expected returns, percentages, yields and the like is like tying shoe-laces and it's probably inconceivable to you how anyone could struggle with it. Unfortunately, a lot of people simply can't do figures - the whole area baffles them.

Which is why the discussion with Cheerfulcat is going round in circles - we are exactly where we are after my first response. You think everyone is capable of working it out for themselves - I disagree. Not everyone has reliable access to the internet to do all this research, even if they could get their head round it. In particular people who have low incomes - who may not have the time to spend hours researching anyway, as they are more likely to need to be working in spare time to make ends meet. Of course well-off, educated people (in which category I suppose I include myself) have plenty of options at hand - but that's not everyone. It's not even most people. Once again, I think we will just have to disagree on this.

Tirian

cheerfulcat

Tirian,

Financial jargon is hugely intimidating to many people - just getting to grips with things like "equities" is going to drive a lot of people to distraction before they even run into the figures - another major barrier. For some people here, I am sure that working out expected returns, percentages, yields and the like is like tying shoe-laces and it's probably inconceivable to you how anyone could struggle with it. Unfortunately, a lot of people simply can't do figures - the whole area baffles them.

What I am trying ( and obviously failing...) to explain is that none of that is necessary! Most managed investment funds - which is where the bulk of people will have their money - do not and cannot outperform the market. For Joe Bloggs who has better things to do with his time than learn about investing, a plain vanilla index tracker, which is a fund which, er, tracks an index ( FTSE 100, Dow Jones etc. ) is a perfectly adequate investment vehicle. This information is readily available, indeed Virgin made quite a fuss of theirs. It is not rocket science. Those who wish to refine their techniques can do so but TBH it is questionable whether they will outperform a tracker over time. You really don't need to know much in order to invest successfully! Just - start early, invest regularly, re-invest any dividends. That's about it. Oh, and keep the charges down.

And the IFA option is still available to everyone.

margaretclare

OK, can I have an attempt here to make it REALLY simple. This is derived from the fact that my grandparents, who were really simple people in the days when 'elementary education' ended at age 12 and you were shoved out to work. They knew that:

1. You should never spend every penny-piece that comes your way. Reason: you may want something one day that you haven't foreseen - this is what we'd call 'rainy-day money'.

2. You should never spend MORE than the money you have coming in, for a number of very good reasons which were articulated by a character called Micawber in Dickens' novel 'David Copperfield'. Mainly, from my grandparents' point of view, life is uncertain, stuff happens, if your earnings are your only income they can disappear at any time. Back to point 1.

3. Anything you have spare each week/month/year should be put somewhere that it can grow. Again, never be tempted to spend what you haven't got.

4. There will come a time when you're too old and can't work. You should save something for that future.

That simple enough for you?

Margaret

shiredeon

in a nutshell margaret,