Money Investment

jamesya

I have some extra income and I am looking to start investing, maybe in shares.

I dont really know where to start with this, or even if it is the best form of investment.

So if someone can give me some tips or ideas with what to do with my money that would be great

Regards

James

dunstonh

regular investing or ad hoc single payments?
how much?
how long for?
is it shares of funds?

jamesy-a

i have around £1000 at the min but then a few hundred pounds every month

Reaper

If you are an investment novice then it is usually better to start off with funds.

If you go for individual shares you need to do some work to make it anything more than a gamble. Wheras a fund you just have to pick an area (eg UK Smaller Companies, Emerging Markets etc) and a fund manager will pick what they think is best spreading the money over many different shares.

For funds you can do as much or as little work as you want picking them. For example you can pick a discount broker such as Hargreaves Landsdowne and choose one or more funds that apeal to you from their top 150.

Or you can put more work into it to narrow down the selection. Have a look at post 2 here if you want info on how to take it further.

If you are investing for the longer term Investment Trusts are an alternative type of fund and can work out cheaper over time.

Another option is a tracker which have lower charges but there is no manager trying to pick the best stocks.

Make sure you keep some cash in reserve. While we all hope our investments will go up in value it should not be money you cannot afford to lose if the worst happens.

Cautious_Investor_3

Hi

I'd suggest you make sure that you build up an emergency fund to start with i.e. some money to fall back on if the need arises.

Only when I have an emergency fund in place would I start looking to invest in anything other than cash (yes, I know the return from cash is poor at the moment but at least you know it's there and won't have fallen in value if you need it in a hurry).

When you are prepared to start investing in shares, whether directly or probably more sensibly via collectives ask yourself:

1. How much risk am I prepared to take
2. How long do I want to invest for?
3. How much access do I need?
4. Do I want to pick the investments or should someone do it for me?
5. What tax wrapper do I want to use e.g. pension, ISA, Unit Trust etc
6. What do I understand? (V importantm often overlooked)

I hope this helps.

The Cautious investor