Where to start investing?

Will123321

eskbanker said:

Will123321 said:

Regarding Point 3:

A bit confused about collective investment, and what's global multi asset? 

Collective investments include funds, which own underlying stakes in hundreds or thousands of companies, offering diversification, in order to minimise risk and smooth volatility.  Multi-asset funds hold different asset classes, such as equities and bonds, again to manage volatility and provide complementary characteristics, and these will usually entail global coverage, thereby again minimising risk by including all major markets.

Buying into an individual company, or even many within one sector within one market, would generally be regarded as poor diversification - even though that particular sector has flourished in recent times, it's unlikely that it would continue to do so reliably over the long term.

The articles linked above explain all this....

Thanks for your time to explain that. So how and where I can find how to start investing, point 3. Collective investment and multi asset funds? 

Thrugelmir

Have you considered increasing the amount you contribute to your works pension? The best investments are often the boring ones that you rarely have to touch. Plenty of time then to start researching the more esoteric options that exist. 

Albermarle

Will123321 said:

eskbanker said:

Will123321 said:

Regarding Point 3:

A bit confused about collective investment, and what's global multi asset? 

Collective investments include funds, which own underlying stakes in hundreds or thousands of companies, offering diversification, in order to minimise risk and smooth volatility.  Multi-asset funds hold different asset classes, such as equities and bonds, again to manage volatility and provide complementary characteristics, and these will usually entail global coverage, thereby again minimising risk by including all major markets.

Buying into an individual company, or even many within one sector within one market, would generally be regarded as poor diversification - even though that particular sector has flourished in recent times, it's unlikely that it would continue to do so reliably over the long term.

The articles linked above explain all this....

Thanks for your time to explain that. So how and where I can find how to start investing, point 3. Collective investment and multi asset funds? 

Have a look at these
Online investment management | ISAs | Pensions | Lifetime ISA | Junior ISA - Nutmeg
Vanguard Asset Management | Personal Investing in the UK (vanguardinvestor.co.uk)

Will123321

Thrugelmir said:

Have you considered increasing the amount you contribute to your works pension? The best investments are often the boring ones that you rarely have to touch. Plenty of time then to start researching the more esoteric options that exist. 

Honestly, I'm not thinking about pension. I don't think I'll live till then. That's why I want to build a passive income from investment. 

bostonerimus

Will123321 said:

Thrugelmir said:

Have you considered increasing the amount you contribute to your works pension? The best investments are often the boring ones that you rarely have to touch. Plenty of time then to start researching the more esoteric options that exist. 

Honestly, I'm not thinking about pension. I don't think I'll live till then. That's why I want to build a passive income from investment. 

Are you unwell or do you have some medical condition that will limit your lifespan? If so then carpe diem, if not, stop and educate yourself about the free money you get with a pension, if you have access to one:
1) You save on tax
2) Most companies will put money into your pension
3) You will probably get a choice of relatively sensible investment funds...not individual stocks or crypto which you should avoid.

Right now stick to paying off any high interest debt you have, make pension contributions to get your employer's match, save at least 6 months spending in the bank and educate yourself about the basics of investment funds and how to use them within your pension and ISA

Thrugelmir

Will123321 said:

Thrugelmir said:

Have you considered increasing the amount you contribute to your works pension? The best investments are often the boring ones that you rarely have to touch. Plenty of time then to start researching the more esoteric options that exist. 

Honestly, I'm not thinking about pension. I don't think I'll live till then. That's why I want to build a passive income from investment. 

Unless you have a sizable amount of capital to invest from the outset. Generating a sustainable income is going to require some hard years of saving. Using the most tax efficient wrapper available should be part of your planning. 

Will123321

bostonerimus said:

Will123321 said:

Thrugelmir said:

Have you considered increasing the amount you contribute to your works pension? The best investments are often the boring ones that you rarely have to touch. Plenty of time then to start researching the more esoteric options that exist. 

Honestly, I'm not thinking about pension. I don't think I'll live till then. That's why I want to build a passive income from investment. 

Are you unwell or do you have some medical condition that will limit your lifespan? If so then carpe diem, if not, stop and educate yourself about the free money you get with a pension, if you have access to one:
1) You save on tax
2) Most companies will put money into your pension
3) You will probably get a choice of relatively sensible investment funds...not individual stocks or crypto which you should avoid.

Right now stick to paying off any high interest debt you have, make pension contributions to get your employer's match, save at least 6 months spending in the bank and educate yourself about the basics of investment funds and how to use them within your pension and ISA

Thanks, I have no debts. But have small capital which would be happy to invest in something to get annually interests. Otherwise money are loosing price because of inflation. 

Will123321

Thrugelmir said:

Will123321 said:

Thrugelmir said:

Have you considered increasing the amount you contribute to your works pension? The best investments are often the boring ones that you rarely have to touch. Plenty of time then to start researching the more esoteric options that exist. 

Honestly, I'm not thinking about pension. I don't think I'll live till then. That's why I want to build a passive income from investment. 

Unless you have a sizable amount of capital to invest from the outset. Generating a sustainable income is going to require some hard years of saving. Using the most tax efficient wrapper available should be part of your planning. 

What do you mean by tax wrapper? 

ndf9876

Will123321 said:

What do you mean by tax wrapper? 

The "tax wrapper" is the account that holds the investments. Most people want to try and keep as much of their money as possible, so use the most tax-efficient account for their needs. For me, considering my investments, that is a Stocks & Shares ISA (I am not going to be investing more than £20k p.a. so that works out well for me). A General Investment Account is also a wrapper, but as explained previously, there would potentially be tax liabilities. A SIPP is a wrapper too, with its own advantages and perhaps disadvantages.

The aim of the "most tax efficient wrapper" is simply to shield your money from paying tax.

I would suggest going back to eskbanker's first post, following the points and browsing some of those links. Choosing a tax wrapper is pretty difficult if you don't know how much you'll want to invest, or what your goals are for the money, for example. Once you figure out how much you want to invest, be that lump-sum or drip-feeding, and what you want the money for, then you can have a think about what sort of account you need.

Will123321

ndf9876 said:

Will123321 said:

What do you mean by tax wrapper? 

The "tax wrapper" is the account that holds the investments. Most people want to try and keep as much of their money as possible, so use the most tax-efficient account for their needs. For me, considering my investments, that is a Stocks & Shares ISA (I am not going to be investing more than £20k p.a. so that works out well for me). A General Investment Account is also a wrapper, but as explained previously, there would potentially be tax liabilities. A SIPP is a wrapper too, with its own advantages and perhaps disadvantages.

The aim of the "most tax efficient wrapper" is simply to shield your money from paying tax.

I would suggest going back to eskbanker's first post, following the points and browsing some of those links. Choosing a tax wrapper is pretty difficult if you don't know how much you'll want to invest, or what your goals are for the money, for example. Once you figure out how much you want to invest, be that lump-sum or drip-feeding, and what you want the money for, then you can have a think about what sort of account you need.

Thanks. I'll need to check it out. Let's say I want to invest £5k in long term. What would you recommend