Dipping a toe - where do I start?

elsien

I have 10K left over from my redundancy money that now I'm employed again, I'd like to put to good use. I am nearly mortgage free and have a good emergency cash fund built up. Pensions aren't great as I didn't join one till I was 30 - now 50 and are a mixture of one final salary one and a couple of smaller defined contribution ones.
I'm a cautious investor and my one foray into the stock market so far was a NSI guaranteed equity bond that matured last year and hasn't been renewed.
So as interest rates are so rubbish, I'm thinking of using the 10K to invest somewhere longer term to build up towards retirement, possibly a S&S ISA. And that's as far as I've got - so how do I decide where to start, and what fits my risk profile? I don't have a huge amount of faith in my ability to get it right, but the last time I spoke to an IFA about pensions a couple of years back they weren't interested in the amounts of money I was talking about which has put me off them. And I don't know anyone who could give a personal recommendation.

pathtofreedom

Have a read through https://www.monevator.com/category/investing/passive-investing-investing/ as well as the book smarter investing by tim Hale.

They are a good place to start to understand spreading your risk and will also help understand your dc pension funds better and if you should change any of those or not.

Investing this way is not a quick thing though and you need to be happy with the money going up and down, but knowing if you wait 10-20 years you should be better off in the long run, even if that is just with dividend income and not with capital gain.

Consumerist

Pension-wise you might also want to investigate whether Additional Voluntary Contributions to your State Pension are a viable option for you. You should start by asking for a <forecast>.

TypicalVillain

Globally diversified index funds are the way to go! The key is to look for funds that have low expense ratios (these are basically fees). You could talk to a financial advisor just make sure they're "fee-only," meaning they take a flat fee (as opposed to taking a % of your portfolio). Fees are the enemy!

Radiantsoul

A good starting place is the Finance section of your local library! Hale's book is often recommended.

I would say that interest rates are rubbish, but the return on shares is potentially likely to be rubbish over the medium term. There is a chance they might do better than savings, but the risk they might do a lot worse.

Assuming you are saving for retirement you need to consider when you want to retire, how much you will need to live on and how much you are able to save per year. You probably don't have a lot of time if you are looking to retire in your early 60s and compound interest will not do a lot over 10 years. So you may well need to save pretty hard.

In terms of what to invest in, it will depend on your risk profile. You probbaly want a nice multi-fund.

AlanP_2

It may be worth considering a Pension wrapper as opposed to an ISA particularly if you are a Higher Rate Taxpayer.

From April this year you can access it at Age 55 so it would be locked away for a minimum of 5 years in your case and depending on what and how you access it the limit on what else you could pay into a DC or Personal pension may be affected. Plenty of info on the retirement board if that is an option that you might go for.

Whichever way you go S&S investing has potential downsides so you need to be comfortable that you can stomach what could be a 40/50% loss in face value at some time in a typical 10 year period and sit tight waiting for values to go up again.