Investment guide for newbies?

I want to learn more about investing but need it in relatively simple terms, can anyone recommend me a book or website, etc?

I’ve come across the Fools books and website, are these rated?

Need to save for retirement, Uni fund for the kids etc, and am tempted to use the long term stock growth to help etc.

Nothing’s straightforward in the world of investment any more. With inflation running higher than interest rates you are effectively losing money by saving.

The lack of movement in the housing market means that property is a huge risk so I would make sure you pay off all interest-bearing loans and stick the rest in premium bonds until the picture becomes clear.

See a professional?

What BJ above is advocating is partially sensible (clearing interest bearing loans first) but putting money into “premium bonds and waiting until the picture is clearer” is just crazy talk IMHO – markets are on a steady climb (yes there are wobbles now and then) and the outlook for the next 12 to 18 months looks encouraging – so, you could put money into premium bonds in the hope that you get a return; let markets get to a high; when things look good invest your money and then watch the markets fall; take your money back out until things become clear again……..and repeat the above process ad infinitum…..

If you’re not sure always get professional help – check out local advisers to you on HERE[/url] although I am sure there are others on here who will disagree and encourage you to go it alone….. 🙄

Email is in profile if you want any help.

Hi Bream

That’s a really good question. There are a few simple rules to investment:

1. Don’t invest in anything that you don’t understand.
2. If it sounds too good to be true, it probably is. Walk away.
3. Diversify your investment portfolio. Whilst you’ll reduce your chances of a big return on one investment, you’ll reduce the risk of making a significant loss.

BigJohn is right with respect to paying down debt – in a low interest environment, this is a very effective way of improving your situation.

Make the best use that you can of tax breaks, for example cash and equity ISAs. Take out a pension (if you don’t already have one), as your contributions are taken from your gross income (before tax), rather than your net income (after tax).

Work out what you’re saving money for, and what your time horizon is (you mention kid’s education and retirement, which are good reasons for saving!). In general, equities (stocks and shares) outperform other forms of investment in the long term BUT there are risks that you could make a loss if the market crashes.

Remember also that much of the long term gain from equities comes from reinvesting the dividend income, rather than from increases in the share price.

Motley Fool website & books are good and come recommended. Most respectable newspapers carry a personal finance section that should get you up to speed on the lingo. Investors’ Chronicle magazine is available monthly in newsagents. If you want financial market data (share prices, historic info on dividends etc), http://www.iii.co.uk can provide this free (you have to register, but it’s been fairly painless in my experience).

Feel free to PM me if you’d like to discuss this further.

Good luck!

see trustnet.com
use hargreaves and lansdown or someone similar as dealer
investment trusts – read the initial and mgmt charges
isa – isa baby – do this 1st
don’t buy things on interest of above 0%
if you have a mortgage look at what you can save by paying it early
if you get 1.5% interest on savings and pay 5% on a mortage then savings = a cost
understand the concept of pensions, pension tax relief, money purchase, annuity, drawdown, 55 years old, 75 years old.
consider the concept of comission very carefully, you can sell quality and get 1% or shite and get 20% – what would you do ……, sorry what would your adviser do ?

If you really want to understand about investing, then the first thing you need to understand is the risk/reward principle, which basically states that the amount of return you should expect, must be determined by the risk you take holding that investment.

I can’t recommend it for bed time reading, but Brealey & Myers’ ‘Principles of Corporate Finance’ will give you a good grounding in the basics of investing. Yes it’s geared to corporate investing but the basics are the same.

Brealey & Myers[/url]

Invest the lot in diesel powered nuns. Surefire winner.

Pay off debt then buy blue chip shares in a company you understand. For me I invest in companies I am a customer of, and not in some bizarre chinese mining outfit I’ve never heard of..

I bought loads of shares after the .com bubble and the financial crisis and seen massive gains really quickly. Warren Buffets rule of thumb is generally good, buy when everyone is selling, sell when everyone is buying..

I have no bog standard savings accounts, just offset mortgage and shares, some in ISAS.

Do your own research, and invest in companies you are comfortable with and know. BEST ADVISE I CAN OFFER

I invest in Oil Exploration Companies, since i work within the industry so that helps, and have done very very well indeed.

Have learnt not to trust the forums apart from the few trusted posters.

Best advise i can offer really

A) Stop spending money on bits and pieces like Costa coffee – £5 a week = £260 a year. You’ll have to save / invest a lot to beat the not spending money syndrome.

B) If debts interest > savings interest including tax benefits then pay off debt

C) if life’s getting on top of you then spend it on fast cars. loose women, cocaine and/or bikes – your choice as to the order……

The Motleyfool stuff is as good a starting place as any other. Plus the Alvin Hall stuff is (mostly common sense) OK.

long term stock growth

There are those who say we won’t see much of this for a while, although I see that the US is printing money again which may help in the short term.

If you don’t know what you’re doing a tracker fund is probably the least likely to get you into trouble. FTSE100 if you want to play it safe or a far-East or emerging markets tracker if you get your kicks from gambling.

Thank you for all the replies, I know the real basics and have some common sense 😉 but the whole mechanics of it is a little confusing.

Firstly I live in Sweden so it makes it a little more complicated as tax breaks are different etc. I guess I could move some money over to my UK account but as it costs every time money is transferred and depends on the exchange rate then maybe it isn’t so viable!? I guess I need an expert who knows English vs Swedish finance :?.

We have no loans and only a small mortgage, one of the lucky ones I guess through hard work and luck with the UK housing market, we bought low and sold at the peak. Lived in a flat for 3.5 years and now bought a house in Sweden during the low-ish period. Smart with money, no eating out or cocaine habit to support etc 😆

My wife already has some stock shares that her dad invested for her about 20years ago and that continues to grow nicely, so she already has a pension fund up and running. I don’t, I had to cash in my pension when I left the UK and I’m not currently putting anything away here.

Our bank here has offered their service of some sort of tracking fund, but I don’t want to jump in without knowing more about it. We’re currently saving £250 a month and I’m looking at an investment period of 18 years for a Uni type fund, and 27 years for my pension.

If I can do some more research first then I think it will help me go talk to the bank again or another adviser perhaps.

Firstly I live in Sweden

My wife

This thread is useless without pics I’m afraid

This thread is useless without pics I’m afraid

2nd from the right, and I’m on the left 😆

Fantastic 😀

Buy low, sell high.

General advice is invest in mostly in risky stuff (shares) while you are young because if it goes down you still have time to recover. I find that advice hard to take at the mo.

Swelper – Member
BEST ADVISE I CAN OFFER
……

Best advise i can offer really

The best advice I can offer is that you should not take advice from someone who does not know the difference between advise and advice.

Google barefoot investor, his book is really good, and he also does a podcast series on Itunes