Do you need guidance with investing?

Here at Brian Mole IFA we want everyone to look after their money and when considering options, to invest wisely. It is easy to make mistakes when investing your money. Everyone works hard to achieve financial growth and stability in their life, so look after your existing wealth. Here are some of the aspects of investing to be wary of.

1. Having too much in cash

With savings rates so low, holding cash could be one of the biggest mistakes you can make. While global stock markets might be volatile at present, they have generally provided a far greater return than cash over the long term (although, of course, past performance is no guarantee of future returns).

So, you should keep enough cash for emergencies and short-term spending and see if you can do better in the stock market. And, of course, make sure any cash you do hold earns the best possible rate.

2. Not spreading your risk

One of the oldest and best ways to lose money from investing is by having a heavily concentrated portfolio. In good times, having a highly focused portfolio can bring bumper returns, especially during one of the market’s periodic bubbles. But when bubbles burst, it’s far better to have a well-diversified portfolio than to be nervously holding a basket with one giant egg in it. Indeed, research conclusively shows that diversifying your portfolio produces better risk-adjusted returns in the long term.

3. Piling in all at once

Another fundamental mistake that investors make is to mess up the timing of their ISA investments. Instead of drip-feeding money over a period of time, millions of us throw lump sums in on a single day, often just as the end of the tax year looms. The big problem with piling ‘all in’ at the end of March or April is that you can easily become a victim of one of the stock market’s seasonal effects. It is a well-known phenomenon that the London stock market often rises in late March and early April as it is pushed up by a flood of cash flowing into ISAS as the tax year ends.

A far less risky approach is to spread out investing in your ISA throughout the year and take advantage of market weakness to top up your holdings. Also, to automate the entire process, why not divide your ISA allowance into 12 chunks and then invest monthly?

4. Not ‘de-weeding’

Poor-performing funds can hold back how well your portfolio does and can cancel out the good work done by making the right choices. So, make sure you regularly review what is doing well and what is not – then act.

5. Not watching those fees

And it’s not just the performance of your investments you need to regularly review.

Fees can seriously erode your returns over the years, so it is important you ensure you are not being ripped off. Whether it a specific fund or your share dealing service, keep a close eye on those fees and do not be afraid to move if needed.

6. Ignoring the rest of the world

Although the UK has the world’s sixth-largest economy, we Brits account for only 2.21% of world output according to the data from the International Monetary Fund. So, by having heavily Uk-centric portfolios, British investors risk missing out on possibly superior returns on offer from other developed and developing nations. When investing, do not overlook the opportunities available in the rest of the world.

7. Mismatching income and growth

Another tip to create a properly balanced portfolio is this: do not buy growth investments when you need income, and vice versa.

If you want a regular income, look for investments that are likely to pay a dividend. If you want capital growth over time, seek out investments that look undervalued.

8. Making things complicated

If you have been investing for a while, it is likely you have built up a portfolio that is spread across a lot of different funds and providers.

But these can be hard to manage and keep track of, so consolidating can help you get a grip on your investments.

The head of a well-known investment company recently said:“the easier your pensions and investments are to manage, the more likely you are to take good care of them, and make better, timelier, investment decisions. Create a single bird’s eye view of your portfolio by consolidating your investments into one place, making them considerably easier, quicker and often cheaper to manage.”

How Brian Mole IFA Ltd can help you

At Brian Mole IFA we have many years of experience in looking after clients investment and pension portfolios. Once we have met you and got to know your thoughts and position, we introduce a detailed analysis of your personal attitude to investment risk, before working on a personal one to one basis with you and one of our fully qualified, independent financial advisers. We create a portfolio that suits your own unique risk and plans for now and your future.you will never be just a number with us, we will look after you on your financial journey through your life. Advising you when you need to make major decisions, like house moves, change of jobs, children, grandchildren, retirement, inheritance, plus any event in your life that needs financial guidance.