Savings v investments - what’s a good proportion of each?

ShinyStarlight1

Obviously this will vary hugely according to age, situation, plans, health etc.

But all things being equal, what do you regard as a healthy proportion of your assets being held in savings versus investments. For discussion’s sake, let’s assume no debts or mortgage, and an emergency fund in place already.

In my own case, I am currently 37% invested and 63% savings. Approximately 4 years from State Pension. Would, by nature, take more risk but hampered by uncertain health/potentially shortened life.

I’d be interested in other people’s viewpoints on this proportion question.

eskbanker

But all things being equal…

But, as you recognise, all things can't be equal, so your situation in your sixties will differ significantly from someone in their twenties (or nineties!), even without health complications and all the other individual circumstances that influence this.

InvesterJones

Also proportion is the wrong measure to look at this - proportion doesn't tell you how much you will need for your emergency fund for example, or other short term needs. Savings are more likely to be an absolute amount, with the excess going into investments and therefore making up a variable proportion.

VXman

Also depends if you need growth or not.

I am probably cash rich (£172K in ISA's, 14K in instant Access, £37K in Reg. Savers, £100K in Investments) So 31% Investments 69% cash. But to blunt, I have more money than I need - my regular income more than covers out goings so this £323K is 'spare' money. I don't feel the need to make it grow. As long as it is keeping with inflation and maybe a bit more I am happy.

Everyones circumstances and attiude to money is different.

ShinyStarlight1

https://forums.moneysavingexpert.com/discussion/comment/81995507#Comment_81995507

I knowwwwww!! 🙃

It was more of a gazing-into-space-wondering-what-other-people’s-ideal-proportion-would-be. And why.

Eco_Miser

I agree with Investor Jones, one keeps enough in savings to cover planned spending and emergency fund (emergency fund isn't a separate account, it's the excess over planned needs across ones easy access savings), and the rest goes into investments.

I'm 76 and 76% invested (the numbers are just co-incidence), 11% easy access cash, the rest in term accounts and Index Linked Saving Certificates. My income comfortably exceeds my normal spending, so I don't expect much to change until I go into a care home (if I do).

dunstonh

But all things being equal, what do you regard as a healthy proportion of your assets being held in savings versus investments. For discussion’s sake, let’s assume no debts or mortgage, and an emergency fund in place already.

What do you mean by investments?

Investments aren't all one risk level.

ShinyStarlight1

S&S ISAs, pensions, that sort of thing.

wmb194

https://forums.moneysavingexpert.com/discussion/comment/81995614#Comment_81995614

Those are wrappers, what are you investing your money in?

DRS1

So far not much notice has been taken of this bit of your post "hampered by uncertain health/potentially shortened life." When people talk about investing in stocks and shares (or even global trackers like VWRP) they talk about a long term time horizon - such as ten years plus. If you don't have that long a time horizon then maybe you shouldn't be investing in stocks and shares.

Some of us know we are lousy at investing so keep more in savings. Currently I am probably 60% savings and 40% investments (and a lot of those investments are fixed interest so maybe don't count as investments). Before I turned my pensions into annuities it was probably more 50/50.

Just because the government has decided the public aren't "investing" enough and save too much doesn't mean we should take any notice. In fact that is probably exactly the time to steer clear of investments.

ShinyStarlight1

https://forums.moneysavingexpert.com/discussion/comment/81995617#Comment_81995617

I wasn’t intending to go into such detail. It was more of a musing generalised question.

Perhaps my original post is unclear and suggests I’m seeking thoughts on my particular situation, when I was just wondering what proportion everyone else was comfortable with and why.