23 year old with £10,000…

ColdIron

london21 said:

invest in a lower risk index fund.

Given that 100% equities is above the risk tolerance of most people in the UK what index would you suggest for someone looking for 'As little risk as possible' and 'Doesn’t want high risk'?

jimpwarsop

Cash LISA, £4k this month, £4k on April 8th.

25% growth minimum.

steampowered

Young people should generally put their money in higher risk investments. As they have a longer investment horizon which means more time to ride out the swings and roundabouts of the stock markets. You usually start moving into lower risk investments as you approach retirement. 

"Low risk" risk often means keeping the money in a savings account. But if you do that you will lose a little bit of your savings each year due to inflation.

Low risk is appropriate if the money is needed in the short term (e.g. to fund a house deposit in the next few years). If your son has a longer horizon then that, then he should  consider medium risk investments (e.g. stocks & shares ISA with a medium risk investment fund) to keep pace with inflation.

P1Fanatic

If its saving for a house then a Cash LISA definitely. As above £4k now and £4k once into new tax year. £2k bonus added on top for doing nothing won't be beaten anywhere else. Put the other £2k in a Savings Account. Only downside is if its used / needed for anything other than buying a house (first house only) you will lose the bonus (unless you wait until age 60).

Thrugelmir

ronaldadio said:

bostonerimus said:

"Doesn't want high risk" could mean anything from medium risk to no risk at all. Your son is in a great situation to take risk with his money. I suggest he does some reading about investing and personal finance. In his situation I would probably put about half in the bank or a cash LISA and the rest into something like VLS100 ie a global equity fund, in and ISA or a company pension fund, but that is risky...

As little risk as possible but with some return 

Ask your son to post and contribute to the discussion. After all it's his money. 

macman

wmb194 said:

ronaldadio said:

bostonerimus said:

"Doesn't want high risk" could mean anything from medium risk to no risk at all. Your son is in a great situation to take risk with his money. I suggest he does some reading about investing and personal finance. In his situation I would probably put about half in the bank or a cash LISA and the rest into something like VLS100 ie a global equity fund, in and ISA or a company pension fund, but that is risky...

As little risk as possible but with some return 

So a savings account.

That would be zero risk. OP needs to quantify 'not high risk'.
OP, how old is he? Is he already in a pension scheme?

eskbanker

macman said:

wmb194 said:

ronaldadio said:

bostonerimus said:

"Doesn't want high risk" could mean anything from medium risk to no risk at all. Your son is in a great situation to take risk with his money. I suggest he does some reading about investing and personal finance. In his situation I would probably put about half in the bank or a cash LISA and the rest into something like VLS100 ie a global equity fund, in and ISA or a company pension fund, but that is risky...

As little risk as possible but with some return 

So a savings account.

That would be zero risk. OP needs to quantify 'not high risk'.
OP, how old is he? Is he already in a pension scheme?

No, it wouldn't!  It's an oft-repeated myth that cash savings are 'zero risk' but of course they're not - there is no risk of capital loss (if using FSCS-protected institutions) but inflation risk is a significant factor when interest rates are way short of inflation, i.e. the money will lose real-terms value....

bostonerimus

A Cash LISA and contributions to a workplace a pension would offer immediate guaranteed tax gains. We'll need to discuss what fund your son uses in the pension as now is when he should be taking lots of risk.

Exodi

ronaldadio said:

As little risk as possible but with some return 

It really would be a shame for a 23 year old with a 5+ year horizon, to put £10k into a 0.10% AER savings account.

If it's defintely going to be used for a house, a LISA would be a good idea. If not, perhaps chuck it into NS&I as virtually zero risk option.

Otherwise, consider increasing risk tolerance and invest in index funds - which I would still consider very low risk. If an index fund lost any significant value, I think there would be more to worry about than just your investment!

cx6

If you want low risk and it's not for a house then premium bonds.