2k investment

Baldytyke88

rockchick113 said:

Thank you all for all your comments,I’m none the wiser but more confused lol. 😊

I buy shares, I have been doing so for over 30 years, but it is gambling.

Just like buying Premium Bonds, you are unlikely to lose all of your money.

But RPI inflation is 3.5%, you should be able to beat that by at least 1% with a top savings account.

eskbanker

allegro120 said:

eskbanker said:

allegro120 said:

rockchick113 said:

Thank you all for all your comments,I’m none the wiser but more confused lol. 😊

Is there any reason why you prefer to invest instead of make your money grow in FSCS protected savings accounts? Savings accounts are much more simple, you get what is promised, no gamble, no loss and less confusing.

OP does mention that it's money for the long term, over which investing will generally outperform saving (which rarely keeps pace with inflation for a sustained period), albeit with some more complexity involved.

Complexity and risk. Investments generally outperform, but one can also loose some of their capital (or all of it if they are extremely uncareful).

Long term is a loose definition, for some 5 years is a short term and for some 1 year is long.  OP didn't specify the time. Overall over a period of about 30 years my "long term" savings kept me above the inflation. 

It all depends on personal circumstances and attitudes, but I think in case of £2k (assuming this is the only spare cash to play with) to invest without any prior knowledge/experience is not the wisest decision to be made.  Even if S&S outperforms savings in 20 year's time the profit won't be significantly larger than from savings accounts. 

It's true that OP neither clarified what they mean by long term, nor how much they'd anticipate investing beyond the initial seed amount, nor what other assets, such as savings, they have, so we're all effectively making some assumptions, but perhaps some more than others!

Beating inflation over 30 years while staying in cash is a pretty remarkable achievement, how many times have you needed to move your pot to do that?

Baldytyke88

allegro120 said:

It all depends on personal circumstances and attitudes, but I think in case of £2k (assuming this is the only spare cash to play with) to invest without any prior knowledge/experience is not the wisest decision to be made.  Even if S&S outperforms savings in 20 year's time the profit won't be significantly larger than from savings accounts. 

I have put £500 in my 23 yr old daughters SIPP, in Norcros, it will have a long time to increase in value.

DesertRose

@rockchick113, this is what I do:
I opened a S&S ISA with Fundsmith called 

Fundsmith Equity Fund T Class Acc

It is in effect an ISA, max you can put in a year is £20,000 tax free. I pay monthly, by direct debit £100, which is the minimum. These are money I’m not going to miss if it all goes to pot, or loses value, I put the money in on the day I get paid and very rarely check on it. Once it’s open, you can put as much as you like, the whole £2000 you have if you want, I’ve never done it, but the max in a year is 20,000. You can take the money out any time should you need it, but I don’t even think about it as savings or money or anything, it’s there for the next 20 years when I retire if I make it that far, I have a daughter, it’ll be all left to her. 

Don’t let the jargon put you off. I’m sure a great deal of education and intelligence goes into it, but at the end of the day, it’s just financial slang. You’re taking a gamble, which horse are you betting on. You place your money and hope for the best, that’s pretty much it. 

allegro120

eskbanker said:

allegro120 said:

eskbanker said:

allegro120 said:

rockchick113 said:

Thank you all for all your comments,I’m none the wiser but more confused lol. 😊

Is there any reason why you prefer to invest instead of make your money grow in FSCS protected savings accounts? Savings accounts are much more simple, you get what is promised, no gamble, no loss and less confusing.

OP does mention that it's money for the long term, over which investing will generally outperform saving (which rarely keeps pace with inflation for a sustained period), albeit with some more complexity involved.

Complexity and risk. Investments generally outperform, but one can also loose some of their capital (or all of it if they are extremely uncareful).

Long term is a loose definition, for some 5 years is a short term and for some 1 year is long.  OP didn't specify the time. Overall over a period of about 30 years my "long term" savings kept me above the inflation. 

It all depends on personal circumstances and attitudes, but I think in case of £2k (assuming this is the only spare cash to play with) to invest without any prior knowledge/experience is not the wisest decision to be made.  Even if S&S outperforms savings in 20 year's time the profit won't be significantly larger than from savings accounts. 

It's true that OP neither clarified what they mean by long term, nor how much they'd anticipate investing beyond the initial seed amount, nor what other assets, such as savings, they have, so we're all effectively making some assumptions, but perhaps some more than others!

Beating inflation over 30 years while staying in cash is a pretty remarkable achievement, how many times have you needed to move your pot to do that?

A lot of times across numerous products.  Of course it requires some work, none of the products stay competitive for a long period of time, that's a caveat.