Saving money to invest in a future goal is a satisfying one. There are many different investments available, each offering the potential for a return that can beat inflation. It is crucial to think about the different kinds of investments and how they will fit into your overall financial goals.
Investments and funds
A fund is a group investment in which your and other investors’ funds are pooled together and then placed in a variety assets. This spreads your risk, because you don’t depend on the performance of a single asset type. For example, a UK equity fund would be comprised of shares of various British companies.
However, you can find funds that provide a variety of asset types or even more specific industries. This means that there’s a fund that is suitable for every investor no matter their level of experience, timeframe for investment or approach to risk.
Bond funds are a popular choice of investment. They are made up of IOUs (debt) typically from governments or companies – and can be an investment that is less volatile than stocks. However, they can be affected by changes in interest rates and the credit rating of the issuer.