Investments are, in very simple terms, a way to store money with some expectation of future benefit. However, for the past decade interest rates have remained at historic lows, well below the rate of inflation. This means that your money is effectively losing value year on year; the purchasing power of every pound in your account is going down, and over time your savings, through no fault of your own, are therefore being eroded.
We understand that an ever-increasing number of you may therefore be exploring different options in order to make your money work harder for you. Diversifying your investments has a number of advantages – most pertinently, better rates of returns that may allow you to achieve your financial goals – but please be aware that investments do carry risk.
There are a variety of different investment options with different risk profiles available to you on the market, including stocks and shares, property, bonds and ISAs. You do not have to be a millionaire to have an investment portfolio; in fact, we offer bonds at an entry level of £5,000. While you may receive greater rewards investing in equity, bonds are a very popular investment choice because they provide investors’ portfolios with security and reliability, offering fixed and predictable returns.
Before you begin your investing journey, it is important that you assess your financial situation and ensure that you have covered any existing debts you may have and are able to cover any foreseeable household expenses going forward. The next question to ask yourself is: how great is my appetite for risk, and how can I balance this against my goals? Our relationship managers always stress that investors should only invest the amount they are comfortable with, and this varies from person to person.
Once you are ready, you will need to explore the options available to you, which can be done by speaking to one of our relationship managers. You can decide whether to go for income or growth options – in other words, investments that provide you with regular payments or those that provide you with capital growth, where the income is automatically reinvested, and your funds build up at a quicker rate – or a combination of the two. We specialise in green bonds and have both income and compound interest options available.
We understand that you have worked hard for your money and should be rewarded for having done so. We treat your money as if it were our own, and only offer investment bonds in businesses that we believe in and that have undergone a rigorous due diligence assessment.
Please note this is simply a guide to help you understand investments and does not constitute financial advice. Investments carry risk to your capital and returns are not guaranteed. Please click here to view our full disclaimer.