Almost nobody in my workplace invests in the stock market for their retirement, it's insane.

strawb_shortcake

Perhaps some of your below average paid colleagues are on means tested benefits and savings (pension aside) will stop their benefits. 

I've been the low paid person bringing up a family, sometimes getting to the end of the month and being in the black was a win. Investing and saving just was not an option.

Also, talking openly about savings and investments "isn't very British" in over 20 years of work I wouldn't dream of asking my colleagues about their saving and Investing habits. And I can't say I've ever heard a similar conversation in the work place. 
I've been open on other threads that I have max premium bonds, in the real world, only 3 other people know that, and that's 2 more than need to know.

[Deleted User]

Altior said:

masonic said:

Had I not switched from only being a saver to being primary an investor in my twenties, I would not have reached financial independence.

It is a shame that myths about investing are still being propagated today, even right here on this forum it seems, but I think more and more people are learning that long term investment is different than the short term speculation seen in the movies.

Charges have come down significantly and access has never before been this good. It is just a shame that those who are most sceptical tend to be those who need the additional returns the most.

Of course those who cannot afford even to save are not in a position to do anything about it even if their attitude to investing is more positive.

not the same as negative equity or seeing your investments fall to half practically overnight and not bounce back.

If/when we see a deep global recession, equities significantly falling and no recovery for years, then we'll really see how well people heavily invested in equities react. 

I've only experienced one negative decline in my fund and that was when covid struck. I watched the market drop double digit percentages in one trading week but I continued buying and I never panicked because I was 99.9% certain the market would recover, because it's recovered, every single time since the stock market existed. 

The global stock market has survived WW1, the great depression, WW2, the cold war, cuban missile crisis, dot com bubble, 9/11, housing crash, covid, ukraine / russia war. Countless presidents and world leaders, inflation, trade wars etc and these are just the things I think of off the top of my head. It may take 1 year, 5 years, 10 years or even 15 years but I'm extremely confident it will recover, because it always has. 

Of course if you buy once and never buy again you could easily be burned and sucked into a 10 year bear market but if you buy every month consistently for 30 years you'll just end up with a nice fair average. Sure you'll buy the highs but you'll also buy the mids and the rock bottom lows along the way. It's simply a winning strategy. 

To be honest I think the only thing that would permanently tank the global stock market is a full scale nuclear war that results in the literal death of the planet... But if that happens the last thing you'll be thinking about is your stock portfolio when you're trying not to die to radiation fallout. 

simonsmithsays

[Deleted User] said:

To be honest I think the only thing that would permanently tank the global stock market is a full scale nuclear war that results in the literal death of the planet... But if that happens the last thing you'll be thinking about is your stock portfolio when you're trying not to die to radiation fallout. 

I'd still be checking the No Chat Regular Saver thread.

masonic

Altior said:

masonic said:

Had I not switched from only being a saver to being primary an investor in my twenties, I would not have reached financial independence.

It is a shame that myths about investing are still being propagated today, even right here on this forum it seems, but I think more and more people are learning that long term investment is different than the short term speculation seen in the movies.

Charges have come down significantly and access has never before been this good. It is just a shame that those who are most sceptical tend to be those who need the additional returns the most.

Of course those who cannot afford even to save are not in a position to do anything about it even if their attitude to investing is more positive.

It's not as simple in that, in my view. Most people can't take a big drop in their money (as they see it) in their stride, they'll panic. Human nature. I know about this stuff and even I can find it difficult to keep invested and investing in a falling asset. It's a challenge, for sure. 
I mentioned it on the forum elsewhere, real pain hasn't been felt for nearly two decades. It should have happened in lockdown across the west, but vast money printing postponed that pain and inflated assets. Yes we've seen high inflation, but not the same as negative equity or seeing your investments fall to half practically overnight and not bounce back.
If/when we see a deep global recession, equities significantly falling and no recovery for years, then we'll really see how well people heavily invested in equities react. It's actually worrying enough that it seems like a one way bet to many right now. 

Investment is a spectrum, but you are right about needing to be able to tolerate declines. There are options available to those with lower risk tolerances. I have a family member using a cautious PruFund, which is not my cup of tea and wouldn't get much love here, but smooths out returns and allows them to sleep at night. Personal Assets / Capital Gearing trusts are favoured by several more risk-averse forumites, and I have held these in the past when the bond market was uninvestable. There are probably other alternatives, but this isn't an area I'm particularly knowledgeable about.

I know I'm not telling you anything you don't already know, but it bears mention that there are risks associated with exclusively using retail savings products. Long term decline of sterling and inflation (to some extent two sides of the same coin) are always eating away at any gain in nominal value, and there can be long periods where a negative real return is achieved. I am not optimistic that either of those stories are over, but even if they are, it will take much longer to recover when a low return asset erodes in value.

Putting all one's eggs in one basket, whether that's an equity index or cash savings, is risky.

Cornish_mum

I agree with the premise of this thread, my Dad who is was a lecturer in economics at an old poly, thinks investing is gambling and for rich people and ISAs are form of tax evasion. 

He benefits from a lovely TPS pension so never had to think about personal finance; despite economics being his actual job! 

My brother and I had an uphill struggle to explain our different situation and that as we have DC pensions (mine is fortunately hybrid), we have to think about these things.

Our parents only ever taught us not to get into debt, buy a house and get a job with a DB pension. I think the changes to employment, life expectancy and pensions are the cause of all this and UK financial culture is taking a long time to catch up with reality.  

LightFlare

I’m happy for people to do as they wish - BUT then expecting state/tax payer to bail them out needs to be stopped.

Theres many options - but allowing someone to opt out to then later on hold their hands out for a freebie is plain wrong

Increasing NI/state pension or making workplace pensions mandatory would be 2 of the many options available.

 Unfortunately, successive governments are just kicking the can down the road and ignoring the problem to score points against and blame “the last lot”

callum9999

I find it frustrating that so many people bemoaning that X, Y and Z aren't included in the curriculum show absolutely no  desire whatsoever to do the most cursory level of research into anything at all (despite it being incredibly easy, and almost everyone has a device that lets them do so instantly 24/7), making it seem rather dubious that they'd sit and pay attention to lectures on tax optimisation and pension planning as a teenager...  

Not least because some of this stuff almost certainly is covered in school. For example, I find it hard to believe that when learning about percentages, it was never mentioned that you want a higher interest rate for saving and lower for borrowing. 

UKX69

[Deleted User] said:

[Deleted User] said:

I work in a slightly below average pay job and I've probably spoken to about 20 out of the 30 colleagues about investing, just to gauge how common it is among "regular" people. 

And literally not one person I spoke to said they invest in the stock market, even when I asked about the workplace pension, about half of them said they opted out because "money now is better than money when I'm dead" which is just silly because the average life expectancy in the UK is 82... So what are they going to do to get by until they die? The state pension only? Yeah good luck with that.

One guy I spoke to who was in his mid 20's said he saves some money but in a savings account with a bank. I asked him what the interest rate was and he didn't even know... So probably like 1.5% if it's a regular high street bank which I suspect it is. I didn't have the heart to tell him he's actually losing money to inflation, not saving it... 

It just seems like not enough people are being financially responsible and taking steps to ensure they have a comfortable retirement. I absolutely promise you when you're 65 and freezing cold in your home because you can't afford to put the heating on, eating from food banks and having no money to do anything, you'll totally regret not being frugal and investing for your future. 

I think too many people live in the here and now without a seconds thought for the future. I understand that money is tight for many people but surely you can put a little bit away each month to supplement your pension when you're old?

I think financial education should be mandatory in schools with students being shown videos of old people living in poverty because they didn't invest in their retirements.

Personally I don't classify investing as being 'financially responsible'. Far from it in fact, its gambling with your hard earned money, in fact its worse. Its letting some other pleb gamble with your hard earned money.

Saving yes, investing no.

You could lose not gain. Not just in comparison to inflation but proper loss.

And life is for living, especially when you're young.

Good for them I say.

Financial responsibility is up to every individual. I agree that it should be taught in schools. I for one, did not take heed until I was turfed out into the hard, cold world of work. Fortunately, I eventually ended up in a job that I enjoyed with many people who were like minded. I got interested in the stock market and began investing not only for enjoyment but also for profit. Along the way, I also put as much spare cash as possible into index trackers and ETF’s. I am also lucky that the company pension I now draw is a final salary scheme, which today are very few and far between. So, between my company pension, two state pensions (Mrs T’s), cash from the trackers and now cashing in my stocks plus cash savings, I am in a position that I feel very comfortable. 

DRS1

[Deleted User] said:

[Deleted User] said:

[Deleted User] said:

I work in a slightly below average pay job and I've probably spoken to about 20 out of the 30 colleagues about investing, just to gauge how common it is among "regular" people. 

And literally not one person I spoke to said they invest in the stock market, even when I asked about the workplace pension, about half of them said they opted out because "money now is better than money when I'm dead" which is just silly because the average life expectancy in the UK is 82... So what are they going to do to get by until they die? The state pension only? Yeah good luck with that.

One guy I spoke to who was in his mid 20's said he saves some money but in a savings account with a bank. I asked him what the interest rate was and he didn't even know... So probably like 1.5% if it's a regular high street bank which I suspect it is. I didn't have the heart to tell him he's actually losing money to inflation, not saving it... 

It just seems like not enough people are being financially responsible and taking steps to ensure they have a comfortable retirement. I absolutely promise you when you're 65 and freezing cold in your home because you can't afford to put the heating on, eating from food banks and having no money to do anything, you'll totally regret not being frugal and investing for your future. 

I think too many people live in the here and now without a seconds thought for the future. I understand that money is tight for many people but surely you can put a little bit away each month to supplement your pension when you're old?

I think financial education should be mandatory in schools with students being shown videos of old people living in poverty because they didn't invest in their retirements.

in fact its worse. Its letting some other pleb gamble with your hard earned money.

Saving yes, investing no.

And this right here is a prime example of stock market illiteracy. I'm guessing you don't know that passive index trackers exist right?

I would never give my money to a "professional" to invest... not only has history proven that the overwhelming majority of them cannot beat the index, but they charge ridiculous fees.

And with regards to "living life". You can still live life and enjoy it but don't spend every pay check every month. Of course you can if you want but when you're old and cold, hungry, living in poverty going to food banks eating 1 meal a day with damp growing in your home, don't you dare blame "the system or the government", or energy companies or anyone else for your new found poverty.

Because it'll be their fault and their fault entirely.

There is a level of contempt oozing from this post which I think is highly inappropriate.

Someone has another point of view from you.  That is entirely legitimate.

Not everyone behaves the way you think they should.  It happens.

fuzzzzy

[Deleted User] said:

It just seems like not enough people are being financially responsible and taking steps to ensure they have a comfortable retirement. I absolutely promise you when you're 65 and freezing cold in your home because you can't afford to put the heating on, eating from food banks and having no money to do anything, you'll totally regret not being frugal and investing for your future. 

I absolutely promise you that if in mid-life you ever find yourself in a hospital bed being told your condition could be life threatening you'll totally regret having been frugal.

No-one knows what the future holds for them and so it is also about having a balanced approach. Save a bit, invest a bit, live a bit.