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kempstar

Investing In Shares

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Im really not sure whether I should be investing in shares... yet. This past year I have spent repaying my rather substantial student debts. I am now in the position where when I get paid, after paying all fixed bills (rent, bills etc) I will have quite a bit of spare money left over each month.

My question is- Should I be investing in shares, whether directly or indirectly? It seems that common investment strategy suggests that one should seek to build up a cash fund first. I would appreciate suggestions as to how I should allocate the money I save each month :) A few things about me-

27 years old

£38k salary (This works out around £2200 net once my pension contribution has been deducted)

Salary will go up quite sharply in around two years time, when I finish exams I am taking (~£55k)

Fixed outgoings of £500 per month (rent, phone, council tax, electricity and so on)

I am in no rush to buy property; I would prefer to pick something up with a derisory offer in 2-3 years than rush to get on the ladder

Although I will reign in my spending, I do enjoy life, and do not want to have to make too many sacrifices. I think saving £700-£1000 per month is realistic for me

No debts

No savings

Any advice would be greatly appreciated :)

Edited by kempstar

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I wish I was on £38K never mind £55K!

Glad to hear your paying into a pension - very sensible.

For a start make sure you've got at least 3 months worth of salary in easily accessible cash. This will tide you over should you lose your job - the amount of people who couldn't manage a week with no income stream is truely staggering.

I would also put £250 a month into a cash ISA - there are plenty of web sites giving you the low down on the best rates.

I'm quite bearish for the stock market in the short term, so I'm not going to recommend anything share wise, but the two things I've pointed out aren't going to cause you bankruptcy...

Regards,

crude

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Just a quickie;

You are invested via your pension scheme.

Have you consider managed funds?

How involved do you want to be? Do you actively want to manage your own fund?

Try think about what you want to achieve first because you don't necessarily need to invest in the conventional way you are thinking. Down the line you may want to consider CFDs, spread betting etc..

Finally, it's always a good idea to have some cash stashed away. I personally only ever risk a small amount of my cash on any one trade.

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£38k salary (This works out around £2200 net once my pension contribution has been deducted)

Salary will go up quite sharply in around two years time, when I finish exams I am taking (~£55k)

Fixed outgoings of £500 per month (rent, phone, council tax, electricity and so on)

I am in no rush to buy property; I would prefer to pick something up with a derisory offer in 2-3 years than rush to get on the ladder

Any advice would be greatly appreciated :)

In 2/3 years time you'll need £55k to buy a hovel!! Start saving HPConned.

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Unless you are a financial guru i wouldnt mess with trying to get short-term stick market gains. I would only invest on the stock market if you can leave it alone for at least 10 years.

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Unless you are a financial guru i wouldnt mess with trying to get short-term stick market gains. I would only invest on the stock market if you can leave it alone for at least 10 years.

I can't figure you out Penbat. For months you've more or less had your own thread, crowing about the stellar rises in the FTSE 250.

Now you're as good as telling someone that it takes 10 years to make any significant gains.

I've made over 4k on my ISA alone this year and I'm a very average Joe when it comes to investing.

This "buy and hold whatever happens" advice seems plain reckless to me.

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In 2/3 years time you'll need £55k to buy a hovel!! Start saving HPConned.

Thats why the OP will buy in 2/3 years time. 55K rather than 200K for a hovel! :rolleyes:

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I can't figure you out Penbat. For months you've more or less had your own thread, crowing about the stellar rises in the FTSE 250.

Now you're as good as telling someone that it takes 10 years to make any significant gains.

I've made over 4k on my ISA alone this year and I'm a very average Joe when it comes to investing.

This "buy and hold whatever happens" advice seems plain reckless to me.

Yes it has been good this year but people like me with longer memories remember the dot com crash and its consequences. THE FTSE100 is still about 20% below its 2000 high so if you had bought an ISA in 2000 you would be an unhappy man even now.

I dont do day trading. I have ISA trackers split between FTSE Allshare and Europe. I started them in 1998 and am still 20% down but things are improving. I dont plan to touch it for years and years.

I had most of my pension in a FTSE250 active fund up to March last year then i switched entirely to FTSE250 active fund. This has proved to be a salvation for me cos much of my pension previously got trashed by technology stocks. I dont plan to touch my pension for another 18 years so hopefully it should get much more healthy but I have still not yet got back to the value in 2000.

I have not put any fresh money into the stock market since 2000 and have since been building up a cash buffer so i should be able to avoid having to fall back on stock market investments.

Edited by penbat1

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Unless you are a financial guru i wouldnt mess with trying to get short-term stick market gains. I would only invest on the stock market if you can leave it alone for at least 10 years.

Not sure I agree with this, investing for the long term is only one strategy and it is quite possible to make reasonable returns over a shorter period.

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Not sure I agree with this, investing for the long term is only one strategy and it is quite possible to make reasonable returns over a shorter period.

You must be joking !!

The FTSE100 is still 20% down from 2000. Many good people got sucked into the dot com boom and consequent crash - then there was the 9/11 crash (which couldnt have been anticipated) and the Iraq War crash.

With hindsite the people who invested during the Iraq war have now made a fortune. Can we have another war please ? Best time to invest is when no-one else wants to and prices are rock bottom but that only happens occasionally.

And if you can make money out of shorting I count that as being something of a financial genius.

Edited by penbat1

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  • 302 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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