RE: Should I invest?14 Jan 2025 12:36
@Wishingstar Good advice from LWHL.
I would add that investment in stocks is not for the faint-hearted, especially with the current UK economy and commentary around that. Take a good hard look at your own appetite for risk and your timeline before you invest in the stock market. You have done well to save £20,000 and your investment timeline of 5 years is good. It depends, whether or not you will need any part of the £20,000 over the next 5 years. If you do, then take those funds out of the £30,000 and do not invest it.
If you decide you would like to enter the stock market, choose your stocks wisely and carry out your own research before you invest - never, ever follow the crowd. Look for stocks that are under-valued and unloved, but have strong prospects, keep up-to-date with events as they unfold, and be patient. Forget about the 'noise' from the doom-mongers, they typically have no idea on how to get rich and build wealth and they typically follow the crowd anyway. Look at the successful wins in the stockmarket, stocks like BAE, Rolls Royce and Marks and Spencer were all relatively 'unloved' stocks only 2-3 years ago. That is how you build wealth: spot the opportunity, research, top up in the lows/dips, and be patient. Let everyone else scrabble about blindly searching for the 'big win'. The fact is, 'big wins' are few and far between. Remember the story the 'Tortoise and the Hare' by Assop? In the stockmarket the tortoise always beats the hare! Take your time, act slowly, deliberately and block out the noise. Never act quickly and carelessly.
If you find you are risk adverse, then keep your £20,000 in a high interest-bearing bank account (term deposit or similar) and let it roll over, so you earn interest on the depot, and so you earn interest on interest. Add to your savings at each top up.
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