I want to invest my £5,000

dutchcloggie

Hello,

I have £5,000 that I would like to use to start investing (I don't mean in high paying bank accounts etc). I have decided I can afford to risk lose the money in exchange for potentially growing it. But all articles about starting as an investor give advice about what kind of funds etc. This is useful but misses a vital step: you don't just walk into a shop and ask to buy shares or bonds.
Where do you go to buy the stocks and shares? A bank? Who advises you on which fund managers to use? I'm not stupid or just throwing my money at something I don't understand. I have an idea of what I want but I don't know where to go to actually get it, if that makes sense. Like knowing I want to buy a rocket but where do you go to buy one of those since there are no Rocket Shops....

Should I start with my financial advisor?

LHW99

A financial advisor may not be interested in that size of investment, unless you have a larger portfolio.

You can buy shares via a bank, although that would probably be expensive. Search this site for "platform" - there are plenty of threads discussing, for example Hargreaves Lansdown, Cavendish, Interactive Investor to name a few.

HL can be good to start off as they have many tools, a good customer service team and an easy to use web site. Once you build up a portfolio they can be expensive however.

dutchcloggie

I find it really grating that in order to start investing, you first need a lot of money or else the money making institutions are not interested in helping you...So only those with money to start with can make money? Those with a little cash are left to their own devices, reducing the chance of success?

Stevie_Palimo

It may be grating to you dutchcloggie but look at from the other side here whereby smaller investors will only reap small fee's/returns for the platform they use to buy stocks and shares with.

I can see why it is done and fair it maybe not but at the end of the day it about making profits for the Companies involved and they can pick and choose what they like as they will get business in via big spenders who's fee's and return will be a lot greater thus making them decent returns.

dutchcloggie

Of course I understand it from a business perspective. But it just grates that if you have enough money, you can pay other people to make you even richer, yet if you don't have a lot, you may not be able to make the most of it due to not having access to a similar level of expertise. I know that is how business works and that some people with start off with little money and make lots, but these are exceptions. It is just a small general moan at the world of finance.

HappyMJ

dutchcloggie wrote: »

Of course I understand it from a business perspective. But it just grates that if you have enough money, you can pay other people to make you even richer, yet if you don't have a lot, you may not be able to make the most of it due to not having access to a similar level of expertise. I know that is how business works and that some people with start off with little money and make lots, but these are exceptions. It is just a small general moan at the world of finance.

It's percentages and getting value for money.

If you had £1,000,000 then 1% of that is £10,000 and it's worth someone's time to spend a whole day looking at your finances and your options. If you have £5,000 then 1% of that is £50 and it's just not worth spending any time looking at your options. That wouldn't even get the receptionist's wages and the business rates paid and you haven't even seem the financial adviser.....so...you're on your own.

bigadaj

dutchcloggie wrote: »

Of course I understand it from a business perspective. But it just grates that if you have enough money, you can pay other people to make you even richer, yet if you don't have a lot, you may not be able to make the most of it due to not having access to a similar level of expertise. I know that is how business works and that some people with start off with little money and make lots, but these are exceptions. It is just a small general moan at the world of finance.

Well that's just a generic moan about life being unfair, you just have to get on with it.

The majority of wealth is still inherited, it's always a lot easier to make money if you have money, always was, always will be.

For your sum then Charles Stanley direct are pretty good, cheap on small sums and website is fairly straightforward.

zolablue25

dutchcloggie wrote: »

Of course I understand it from a business perspective. But it just grates that if you have enough money, you can pay other people to make you even richer, yet if you don't have a lot, you may not be able to make the most of it due to not having access to a similar level of expertise. I know that is how business works and that some people with start off with little money and make lots, but these are exceptions. It is just a small general moan at the world of finance.

You may not have the expertise but you do have access to a wealth of knowledge at your fingertips, just do your own research. Its (kind of) the same with any task. You could pay a gardener to sort your garden out if you could afford it, but if you can't you could do it yourself - researching which plants like sun, shade etc and get on with it.

dutchcloggie

Duh. The fact that I am asking for advice here is surely an indication that I am aware of having to get on with it myself and that I want to do exactly that. I am already lucky enough that I feel I could lose £5,000 and not be too troubled by that. Many people are not so lucky. I think it is perfectly ok to bemoan the fact that society seems most beneficial to those with most money. I think most people would agree with me. Which is why I am trying to make more money, to make my life easier.

Not sure why that side note to my question is so important.

dutchcloggie

By the way, I know there is a wealth of information at my fingertips. However, I have no understanding of financial matters and maths and numbers are a mystery to me (I'm one of those people who can speak multiple languages but struggles with maths). So it is not as simple as "just read and research". I have read a lot of things and I just cannot wrap my head around the financial world. I will never be the kind of person to read the stock market and understand what is going on and adjust my investments accordingly. But surely that doesn't mean people like me should not have access to the opportunities of investing. So what I was asking for was: where do I start and who can help utter beginners.

I had a look at some of the platforms and it seems a good start. Thanks for the tips on those.

redux

Start reading about collective vehicles such as investment trusts, unit trusts and OEICs.

Some still have their own savings schemes, monthly from £25 or £50 upwards, lump sums from £250 or so, or you can buy via a choice of brokers.