View the article online at http://citywire.co.uk/money/article/a631615
Diary of a Dumb Investor: 10 big problems for novices like me
I have gleaned some investment truths. Some might even be useful for fellow greenhorns.
Watch anyone under the age of, say, 30 pick up a Sunday newspaper in the pub, on the train, in a café or whatever. As part of the standard multi-section purge, alongside the gardening section, the personal finance section will get ditched. Without fail. Guaranteed.
Pensions, mortgages and savings eventually skulk miserably into everyone’s lives, but investment will remain snubbed by most people.
It is, after all, not easy. Here's why:
1: Not enough money
Not everyone has a great uncle who’ll slip them 10K. I do. But it’s not enough – I have had to let some opportunities pass me by because I don’t have enough cash spare and don’t want to sell out of my other holdings.
2. Prohibitive fees
If you don’t have enough money the fees make it prohibitive to diversify – ie, if you’re a funds investor you might just have to get a few. Richer people can invest better.
3: Too much choice
I can’t concentrate. There is too much out there and I don’t know how to narrow it down. I flit between ideas and don’t always see them through. There, I’ve said it.
4. Not enough time
And because there are so many different things to invest in, you need lots of time to research them. It is incredibly time-consuming to research investments like shares. For that reason, collective investment funds seem sensible.
Therefore, add time-rich retired people to the list of investors with a big advantage, alongside the rich.
5. Lack of knowledge
I am amazed by how clued-up some of the readers are on this website are. Bravo!
To start investing you must understand what a share or fund (for example) actually is. Then, which ones to choose. If it’s a share you might need to understand the company’s own prospects, as well as the broader economic outlook. That’s tough.
Then you have to know how to go about investing in it – platforms, tax-efficient wrappers and the like.
News sponsored by:
After Boris announced he was backing Brexit, sterling suffered its biggest slump in six years. Our Market Mavens discuss. Follow the Market Mavens LinkedIn page for weekly videos, in which our panel of industry experts share their views on financial news
The Citywire guide to investment trusts
In association with Aberdeen Asset Management
More about this:
Look up the shares
More from us
- Diary of a Dumb Investor: time to snap up bashed BG Group?
- Diary of a Dumb Investor: I pathetically missed out on a bonanza
- Diary of a Dumb Investor: I’m making a killing on Standard Chartered
Tools from Citywire Money
From the Forums
Weekly email from The Lolly
Get simple, easy ways to make more from your money. Just enter your email address below
An error occured while subscribing your email. Please try again later.
Thank you for registering for your weekly newsletter from The Lolly.
Keep an eye out for us in your inbox, and please add email@example.com to your safe senders list so we don't get junked.