Should you save or invest?
Some people choose to put their money into investments, such as bonds or stocks and shares. Investing can offer you the potential to make greater returns for long-term savings, compared to putting your money into cash savings accounts. But investments could be more difficult to stay on track with, as their value can rise and fall over time. This means you might be on track for your goals one month, only to notice a drop the following month.
Investments should be seen as long-term to offer the best chance for them to perform and ride-out market fluctuations. You should be prepared to hold your investments for at least five years, ideally longer.
Unlike a savings account, investments come with risk and there’s no guarantee that you’ll get the money back that you put in. It’s a good idea to have some emergency savings in an easy-access savings account before you invest. For example, save 3-6 months of money to cover your bills and expenses, so you have some ‘rainy day’ savings to fall back on.
If you’re not comfortable managing your own investments, consider using a financial adviser to manage your investment portfolio for you. Qualified, regulated advisers can offer advice and help manage your investments in line with your appetite to risk over time . Remember, there’s likely to be a cost for financial advice.