Can you recommend any websites or books for people like me to understand the first thing about investments?
30 March 2021
Question by Maggers
I am 64 and financially illiterate. All of our married life our finances were managed by my lovely husband who is now chronically ill. Can you recommend any websites or books for people like me to understand the first thing about investments? And is it too late for someone like me to invest a small monthly sum in something?
Answered by Nicola Crosbie
Maggers, it is never too late to save or acquire new life skills.
Understandably, the prospect must feel overwhelming whilst trying to navigate your husband’s illness. The key is increasing your own financial literacy. The Money Magpie website offers some hints & tips, in plain language, aimed at helping you manage your money, and demystify financial jargon. There is a section entirely dedicated to the over 50’s and the challenges specific to your lifestage https://www.moneymagpie.com/demographic/over-50s. Another easy read is Mrs Moneypenny's ‘Financial Advice for Independent Women’ awarding nuggets of information to empower you to have the confidence to take financial control.
Age UK recently commissioned a report on financial resilience during retirement https://www.ageuk.org.uk/our-impact/policy-research/managing-money-in-later-life/. It concluded that using online budgeting tools or simply writing down income/outgoings, was helpful in identifying savings. This could help free up funds to invest monthly. If budgeting is your balanced diet, savings is the exercise plan. Little and often is the best way to start. Set aside money when you get income in. If your tech savvy, consider using apps like https://emma-app.com/ to save your change or set saving goals.
When investing, you need to consider what risk, if any, you are comfortable taking, understand the timeframe you want to save over and what you want to achieve from your savings. By saving monthly, little & often, you will benefit from compound interest – at its simplest, the investment or savings vehicle you put your money into will give you interest on the interest they have already paid you. By routinely investing a regular amount, you average out the price of investments, smoothing out the highs and lows in share prices. Investments do not have to be risky, there are solutions to reduce volatility and provide steadier returns.
Choosing financial products can be hard, there are so many options and often clouded in financial jargon. If we can look beyond the complexity, there are vehicles to help you achieve your goals & dreams. Look to use tax efficient ways of savings. Annually you can save £20,000 to an Individual Savings Account in Cash, Equities, or a combination of both. Remember your not too old for pensions. Everyone in the UK can save £2,880 per tax year (runs 6th April to 5th April), regardless of your earnings, and receive 20% tax relief at source meaning £3,600 is invested. There are no guarantees when you invest in the stock market, and your money can go up as well as down in value. Investing may not be right for you: if you are going to do it, it is recommended you look to invest for at least five years to ride out any bumps along the way. You should ensure you have savings available in accessible cash accounts for any rainy days or unexpected outgoings. 6 months outgoings is recommended as a minimum.
If in doubt, consult an experienced financial planner to add value and improve your education journey. The best way to find one is through personal referrals - ask your trusted friends & family.
Chartered Financial Planner
With 20 years’ experience behind her, Nicola takes a coaching approach to financial advice, helping even the most nervous investors to take control of their financial situation by empowering them to make more confident, positive decisions for the future. Based in Lochwinnoch, Scotland where she is the Director of Moran Wealth Management Ltd, thanks to secure remote-working practices Nicola supports clients all over the UK.