Finance options for 13 year old banger

System

Arcon - the point is that I can make a return now on money before I earn it, if I wait to earn it I will forgot some investment growth

That's partly why people use a mortgage rather than wait to save up the entire house price in cash - if you wait the price will probably rise and not only do you miss out on the rise but you pay more

IamNotAllowedToUseMyName

MatthewAinsworth wrote: »

Arcon - the point is that I can make a return now on money before I earn it, if I wait to earn it I will forgot some investment growth

That's partly why people use a mortgage rather than wait to save up the entire house price in cash - if you wait the price will probably rise and not only do you miss out on the rise but you pay more

Investments can go down as well as up. You obviously are not of an age to have seen what happens to investments over the long term.

If you base your investment on a loan which is because you have no other assets to depend on to invest, then when that loan matures you potentially have to cease your investment. If that coincides with a problem in the market (and who wants to be gambling on where the stock market will be in 15 months time ATM) you may find yourself having to liquidate at the bottom of the market to repay the loan because you have lost money on your investments so have to eat into other investments you've made, however astutely you thought you'd invested. Any serious investor doesn't worry about the fluctuations of a year, they accept there will be lean years but look to outfox the market by relying on professional people who make it their business literally to beat the market, either directly or though their pension scheme or similar.

System

Ianmspencer - you assume I have no other assets, that's wrong, as I've said I have emergency cash and the idea of the borrowing is to liberate emergency cash to invest, and this borrowing will be very limited in nature such that my wages can easily handle it

I also don't really rate active management, I index

System

I can accept that with short term borrowing there's risk of loss, I budget for that loss, but probability favours doing it

AdrianC

So much downside, so little benefit.

System

We're talking such small amounts that its not unpalatable risk for a small expected profit
And its hypothetical anyway since I won't be able to find that rate secured on a banger

StaffsSW

If it's such small amounts, firstly, why bother financing, as you're not going to get any sort of leverage on investments with £500, or less, and secondly, you would want to lever as much as your own funds in the early stages to grow a small amount into something larger that would give you the control over a much larger asset base.

When you are talking £5000, or £50000, then start looking at bigger pictures, but in the grand scheme of investments, £500 really is nothing besides a bit of pin money to have fun with while you get on with your real job.

System

You're right staffs that its too little, but I'd be scared of bigger leverages, I respect the danger - and it seriously sways me away from buy to let since you can simply wait out an equities crash in a way you can't wait out a property one

To me playing with small amounts is more for fun than serious work. This is all hypothetical and unlikely to happen

AdrianC

MatthewAinsworth wrote: »

You're right staffs that its too little, but I'd be scared of bigger leverages, I respect the danger - and it seriously sways me away from buy to let since you can simply wait out an equities crash in a way you can't wait out a property one

To me playing with small amounts is more for fun than serious work. This is all hypothetical and unlikely to happen

...and that says everything.

qwert_yuiop

MatthewAinsworth wrote: »

You're right staffs that its too little, but I'd be scared of bigger leverages, I respect the danger - and it seriously sways me away from buy to let since you can simply wait out an equities crash in a way you can't wait out a property one

To me playing with small amounts is more for fun than serious work. This is all hypothetical and unlikely to happen

You don’t know that. There’s little to say share prices cannot remain depressed for years. Corbyn in number 10? Indeed the attitude of the chancellor to share ownership and taxation may not always be as favourable as now.