It can be really hard to know where to start when it comes to investment. Just when you think that you’ve got to grips with stocks and shares, along comes the cryptocurrency revolution. Then just when you think that you’ve got your head around Bitcoin, you hear about high returns on P2P loans and find a wealth of other options to chew over. Making your money work is not always simple and leaping on an already fully-loaded bandwagon can be almost as ineffective as allowing your cash to idle in a low-interest savings account. So, what can you do to make the most of your money? Find new and smart ways to invest it.
Long-term savers are often reluctant to make the leap from the traditional bank savings account – Cash, ISA, Trust – into investment. They know, at heart, that investment delivers a greater return, but at the same time, it can come with risks. However, although investment always involves a higher risk than simply not spending your money and letting it sit in a bank account, it’s possible to invest your money carefully, accruing valuable interest, without taking enormous risks. It’s all about finding an investment platform that suits you.
Eight Exciting Ways to Make More of Your Savings
Invest In Companies You Know. There are two lines of thought here. One says that if you know of a company it’s probably too late to buy shares in it because if it’s already a success, there’s only one way it can go – down. And with the fallout of the financial crisis still being felt globally, it’s not hard to see that there might be some truth behind that theory: Woolworths, Borders, Dolcis, The Pier, and more recently, BHS, are all testament to that. However, we’ve also all heard of Apple, Virgin, Prudential, Procter & Gamble, and Time Warner, and they’re not going anywhere, even if their share prices are stratospheric. The point is, that buying what you know can be a safe bet. Purchasing shares in a well-known and solid company can be helpful if you need to recoup your cash at a later date because you can be pretty certain that there is high liquidity and other people will want them too, so you’re not likely to make a loss or to be stuck holding shares you no longer want.
Low-cost index funds. An index fund is a mutual, or exchange-traded fund, designed to follow certain pre-set rules so that the fund can track a specified field of investments. The star quality of a low-cost index fund is that they don't usually experience heavy outflows of cash in bad times. The pay-off for this is that they don’t bring in a heavy flow in good times either. They are all about the reliable, regular trickle, which slowly fills the pot.
Cryptocurrencies. “As the value goes up, heads start to swivel, and sceptics begin to soften. Starting a new currency is easy, anyone can do it. The trick is getting people to accept it, because it is their use that gives the “money” value.” – Adam B. Levine, Founder and Editor-in-Chief Let's Talk Bitcoin!
Cryptocurrencies are a fairly new concept and potentially one of the hardest to get your head around because you’re dealing, essentially, with something without physical form; something that someone else imagined. Money, we all understand. Money, we have in our wallets, pockets, and bank accounts, and even if we spend it virtually, it’s not hard for us to know what we’re dealing with. But you can’t take a handful of Bitcoins or Ether, and yet they are some of the most valuable currencies around. In March last year, for example, Ether was available for just US$10. Three months later, it had climbed to US$395. That’s more than a 1000% increase. Imagine if you had purchased £1,000 of Ether before the climb, then sold them in June. You could be a millionaire.
Cryptocurrencies are widely viewed as the future of investment, transactions could surpass $1 Trillion in 2017 and there are other ways to make them work for you. For example, you can use your cryptocurrency to be involved in ICOs (Initial Coin Offerings), digital way companies use to raise funds. Such an example is the FastInvest ICO coming up in December 2017. Ether can be used to buy FastInvest Tokens (FIT) and holders of the tokens are then able to exchange once the token sale has ended and FIT is expected to be traded on major exchanges from April 2018. ICOs can be a great way to use your cryptocurrency for further financial gains.
Angel Investing. If you're someone with spare cash, who likes to do good deeds but does want to get a little something in return, Angel Investing could be for you. The Angel Investment network is a platform that connects affluent individuals with business starts up looking for funding. The risks are greater than a savings account - and they are yours to assess - but with convertible debt or equity up for grabs, depending on the deal you strike, the return can be phenomenal. Imagine getting in on the ground of a new company, which later turns out to be Instagram. Your one good deed could work out to be your retirement fund. Or maybe the retirement fund for your entire family.
P2P Loans. Peer to peer loans are one of the fastest growing forms of funding now available and are anticipated to generate in excess of US$1trillion by 2025. The appeal to the investor is threefold: You don't need large sums of cash to begin; the return has the potential to be significantly higher than with a bank, and it's relatively risk-free. Working with a platform like FastInvest, it’s possible to begin your portfolio with as little as €1, and with buy-back and default guarantees, there is no risk of your investment failing. Interest rates vary but are always in the region of 9-13%, and loan terms are usually short-term; anywhere between one month and a year. Investments can be automated, so once you’ve selected your criteria, your interest or further deposits can be re-invented on your behalf so that your money is always working for you.
Property. The property has been viewed as a stable investment for a long time now, and with the demand for housing far from shrinking in the UK, that is unlikely to change anytime soon. If you have enough cash to buy a property at auction and spin it on (do it up, sell it), then you can easily find yourself with a 10-20% ROI (return on investment). Renting can generate a similar return year on year. However, just because you don't have enough cash hanging round to pick up a spare house or two, it doesn't exclude you from getting in on the property game. Crowdfunded property is a growing phenomenon and you can gain a slice of the action for as little as £5,000. You’re basically contributing to a larger project and in return, you will receive a portion of the profits when that property is sold. There are various ways to get involved, but the yields are generally good.
Collectibles. Investing in collectables can be hit or miss; from art and fashion to toys and Toby jugs, the market is so variable that you could spend your life acquiring a line of treasured possessions only to discover that they went out of vogue 20 years ago, with little chance of coming back in. BUT, there are still some things worth having. Pop memorabilia. Classic toys in good condition. Classic cars. Japanese ceramics. And anything from the original Star Wars franchise. Investing in collectables is usually something that people do out of love, but if you research carefully – eBay is a surprisingly good source of trending search information – you can make it into a profitable art form.
Debt. Technically speaking, this isn’t an investment, but unresolved debt is the quickest way to lose money. At the end of August 2017, people in the UK owed more than £1.554 TRILLION. That’s a figure so vast that you can’t even comprehend it! When broken down, it works out to be in excess of £30,000 per British adult, around 114% of average annual earnings. Clearing debt will increase your income far more efficiently than any investment, so it’s always the best place to start.
As we’ve seen, investment comes in a variety of forms. You can do it as a career, a hobby, or as means to boost that ‘little bit of cash that you’ve squirrelled away’. It can be as confusing as the stock market, or as simple as buying a piece of memorabilia that you love. It can be as intensive as cryptocurrency plotting, or as stress-free as entering your details into the FastInvest Auto Invest tool and letting our algorithms do the work. The thing is, whatever option works for you, it has to be better than doing nothing.
Every day there are stories in the news about the potential of a generation who will never be able to afford to retire. Investing your savings could help to make sure that you’re not among them.