Poor interest on savings? It’s time to consider investments.

By Paul Northmore, Managing Director

When you hear the word ‘investments’, what do you think?  The super-rich?  Bankers with red braces?  Foreign markets?  It may all seem far distant from day-to-day life in Devon! 

But the fact is that investments are not only for the very wealthy.  More and more Devon people with average incomes and savings are realising the benefits that investments can bring.

First, let’s clarify the difference between savings and investments.

Savings - such as bank or building society savings accounts - are typically safer, but attract lower returns (interest).  Money can usually be accessed instantly or at a few weeks’ notice.

Investments may be linked to stock market or property market performance – so they have the potential to give higher returns, but usually there’s a higher risk.  Investments tend to be a longer-term decision, and there may be penalties for withdrawing funds early.

So for money you may need in the next couple of years, savings could be the better choice.  For sums you don’t have any plans to spend in the short-term (an inheritance or nest-egg, perhaps) you may find it is worth considering investments.

But what about the risk?  Not all investments have to be very risky.  There is a vast array of investment opportunities now available, each with varying degrees of risk and potential return. 

Even clients who are quite risk averse could still find an investment opportunity with which they feel comfortable.  Every client is different, and at Manning and Company one of the first things we find out about our clients is how they feel about risk, because it affects every area of their financial lives, not just investment choices. 

So if you are interested in exploring investments further, let me make some suggestions. 

Don’t jump in with only a little knowledge – it can be a costly thing in the world of investments.  Seek professional advice to ensure you get a complete, balanced picture of the potential risks and returns so you can make an informed decision.  And remember, you have nothing to lose from a free, no-obligation consultation with an investment expert from Manning and Company!