Could your cash WORK HARDER?

Investing savings can help beat inflation and grow your pot

From the price of a weekly shop to soaring energy bills, the cost of living crisis is having a huge impact on our lives. Budgeting can stretch our money, and it’s prudent to consider investing spare cash, rather than leaving it in the bank. Investments can make your money grow faster, help beat inflation and build your financial resilience. You can invest in anything from shares to designer handbags or fine wine, and if it’s something you have a passion for, all the better. Plus, you don’t need a lot of money to get started.

BALANCING THE FACTS

Many women are missing out on the benefits of investing, usually put off by the risks involved. Experts agree investing money for at least five years is more likely to deliver a bigger return than leaving it in the bank. This is backed up by research, called the Barclays Equity Gilt Study, which shows UK shares have beaten cash in 90% of five-year periods since 1899.

How to get started

Before you begin, make sure you have some money set aside as an emergency buffer. Aim to have at least three months’ worth of essential outgoings in an easy-access savings account. Once you know how much you want to invest and how long for, you can sign up to an investment platform. These are like online supermarkets where you can purchase funds, shares, bonds and other investments from one location, usually inside a tax-free stocks and shares ISA or a self-invested personal pension.

Investments

Some investment platforms and apps, such as Wealthify, Moneybox and Plum, will let you start investing with just £1. Others have a minimum investment level of £25. You can choose to invest regularly or with a one-off lump sum. Most online investment platforms offer shares and/or funds. If you don’t want to select shares yourself, choose funds. These are a collection of investments, and may include shares, property and/or bonds. There are thousands of funds, so if you’re feeling overwhelmed, consider using a robo-adviser, such as Wealthify or Nutmeg.

Kalpana Fitzpatrick, author of Invest Now, says a robo-adviser is a great place to start, as it takes the hassle out of investing. Once you’re happier with investing, large platforms, including AJ Bell and Interactive Investor, offer a huge range of shares and funds, as well as pre-made portfolios.

The wealth gap between men and women in the UK stands at an astonishing £1.65 trillion*