Why don't people invest?

jimjames

demonloop wrote: »

Investing in the current climate is tricky and I would be very reluctant to offer the closest of friends any advice.

Up until the beginning of this year I had all my eggs in the managed funds basket, but I'm convinced there is a stock market correction on the horizon.

There is always a correction on the horizon, you just don't know how far the horizon is. People have been saying the same as you since 2012, how much have they missed out on in the last 5 years by staying out of the market?

Interesting to move money into property when many measures show property to be overvalued and various surveys show prices starting to fall...

bostonerimus

trailingspouse wrote: »

I can't say why 'people' don't invest, but I can tell you why I don't (not including pensions and suchlike).

It's complicated, it's time consuming, and if you get it wrong there's a lot at stake.

I think saying 'ignorance and fear', as if people only have to know more and be braver, is very simplistic. I know enough to know that it's not for me, at this point in my life. And I don't scare easy.

I'll agree that there's a lot at stake, but investing is not necessarily complicated or time consuming; there is a big industry vested in making people think that. You don't nee 99% of the products offered by the financial industry and with a little reading you can learn as much as you really need in a weekend. So I stick with ignorance and fear as the main reasons people don't invest. Anyone with average common sense, an understanding of percentages and the capacity to grasp compound interest and the guts to persevere through the down times can invest successfully.

greendoor665

People are ignorant or uneducated, and almost proud of it. They don't know, and they don't want to know. They live in a bubble.

BananaRepublic

trailingspouse wrote: »

I can't say why 'people' don't invest, but I can tell you why I don't (not including pensions and suchlike).

It's complicated, it's time consuming, and if you get it wrong there's a lot at stake.

I think saying 'ignorance and fear', as if people only have to know more and be braver, is very simplistic. I know enough to know that it's not for me, at this point in my life. And I don't scare easy.

It can be pretty simple. Just buy decent passive funds such as a Vanguard Life, and leave it alone. Job done.

I take a more active approach, as I have mainly active funds. But over the last 20 years I've done very little management. Mostly I've selected funds for new money, then left them alone. Then again, I ignore most trends, and most experts. Maybe I could have done better with more time invested, but laziness prevails, and the returns have been pretty good and far far higher than savings accounts.

And the sooner you start, the more you benefit.

Eco_Miser

vacheron wrote: »

I think the simple answer is that the topic simply does not interest them.

You could turn the question on its head and ask:

"I work with highly skilled and trained financial advisers, but none of them will consider running their own home servers or writing home automation applications using embedded Arduino hardware and I often wonder why."

I can see a benefit for engineers to invest, I can't see a benefit for financiers to set up home servers. I can't even see the benefit for engineers except that it could be fun.

bostonerimus

BananaRepublic wrote: »

It can be pretty simple. Just buy decent passive funds such as a Vanguard Life, and leave it alone. Job done.

I take a more active approach, as I have mainly active funds. But over the last 20 years I've done very little management. Mostly I've selected funds for new money, then left them alone. Then again, I ignore most trends, and most experts. Maybe I could have done better with more time invested, but laziness prevails, and the returns have been pretty good and far far higher than savings accounts.

And the sooner you start, the more you benefit.

+1
Sensible initial choices will take you a long way to success. Apart from some rebalancing I haven't changed my core assets much in the last 20 years. A lazy "couch potato" portfolio will work for most people.

https://www.bogleheads.org/wiki/Lazy_portfolios

Eco_Miser

elephantrosie wrote: »

i have noticed that most females do not invest.

Most males don't invest either.
However if you pay attention to the regular posters on investing here, you will notice that many of them are female.

demonloop

Keep_pedalling wrote: »

Unless you had the lot tied up in ISAs you must be looking at a substancial CGT bill on that move.

Yup, all in ISAs.

Re: the property prices crashing if the market crashes, that may well be true of the capital value (moreso in London etc) but the yield will remain the same for me. I’m not planning on selling so the capital value isn’t much more than academic. I realise you could say the same about the fund prices, but I’m still convinced the yield will be superior in the BTLs. Plenty more hassle too mind, with tenants ringing every day!

darkidoe

demonloop wrote: »

Investing in the current climate is tricky and I would be very reluctant to offer the closest of friends any advice.
.

I think investing in any climate is tricky. I can't imagine a time when there are not worries or uncertainties on the horizon. But as a wise man once said, 'I have known a great many troubles, but most of them never happened.'

elephantrosie

economics and finance should be taught in school, right from 5 year old.