The Maxi ISA is a direct investment in stocks and shares – so you’ll need to be in this for the longer-term.

That’s partly because your interest will only grow with the stocks themselves. But less obviously, when you invest you’ll likely find yourself immediately hit by a management fee – for example, 4% of your deposit. So your stocks will need to earn 4% value before you get back to where you started

Investment Options:

High Interest Deposit Account

A bank account? Is that really an investment option?

Sure it is – something that really needs underlining is that if you’re looking to invest on the stock market, you really need to be looking to make long-term commitments.

What a High Interest Deposit Account offers is a short-term investment option, for example, if you’re looking to put a lump sum away for just a couple of years.

You’ll find the interest is usually taxable – but you can also benefit from much higher interest rates than normal savings account at the bank.

And, your money is also safe – whatever the fluctuations of the stock markets, your interest rate should be guaranteed.

Tax Free Savings accounts

Another financial product a bank can usually offer, is a tax-free savings scheme.

Certainly that’s true here in the UK, where the ISA – Investment Savings Account – is widely available.

Take note, though – there are a couple of important points to be aware of.

The first is that ISA’s come in at least two basic forms – often referred to as Mini and Maxi ISA’s.

The Mini ISA is effectively a form of high interest savings – you have a guaranteed savings rate, and again, it’s pretty high relative to current accounts. So a mini-ISA can make a good short-term investment.

The Maxi ISA is a direct investment in stocks and shares – so you’ll need to be in this for the longer-term.

That’s partly because your interest will only grow with the stocks themselves. But less obviously, when you invest you’ll likely find yourself immediately hit by a management fee – for example, 4% of your deposit. So your stocks will need to earn 4% value before you get back to where you started f

Sure it is – something that really needs underlining is that if you’re looking to invest on the stock market, you really need to be looking to make long-term commitments.

What a High Interest Deposit Account offers is a short-term investment option, for example, if you’re looking to put a lump sum away for just a couple of years.

You’ll find the interest is usually taxable – but you can also benefit from much higher interest rates than normal savings account at the bank.

And, your money is also safe – whatever the fluctuations of the stock markets, your interest rate should be guaranteed.

Tax Free Savings accounts

Another financial product a bank can usually offer, is a tax-free savings scheme.

Certainly that’s true here in the UK, where the ISA – Investment Savings Account – is widely available.

Take note, though – there are a couple of important points to be aware of.

The first is that ISA’s come in at least two basic forms – often referred to as Mini and Maxi ISA’s.

The Mini ISA is effectively a form of high interest savings – you have a guaranteed savings rate, and again, it’s pretty high relative to current accounts. So a mini-ISA can make a good short-term investment.

The Maxi ISA is a direct investment in stocks and shares – so you’ll need to be in this for the longer-term.

That’s partly because your interest will only grow with the stocks themselves. But less obviously, when you invest you’ll likely find yourself immediately hit by a management fee – for example, 4% of your deposit. So your stocks will need to earn 4% value before you get back to where you started

And, your money is also safe – whatever the fluctuations of the stock markets, your interest rate should be guaranteed.

Tax Free Savings accounts

Another financial product a bank can usually offer, is a tax-free savings scheme.

Certainly that’s true here in the UK, where the ISA – Investment Savings Account – is widely available.

Take note, though – there are a couple of important points to be aware of.

The first is that ISA’s come in at least two basic forms – often referred to as Mini and Maxi ISA’s.

The Mini ISA is effectively a form of high interest savings – you have a guaranteed savings rate, and again, it’s pretty high relative to current accounts. So a mini-ISA can make a good short-term investment.

The Maxi ISA is a direct investment in stocks and shares – so you’ll need to be in this for the longer-term.

That’s partly because your interest will only grow with the stocks themselves. But less obviously, when you invest you’ll likely find yourself immediately hit by a management fee – for example, 4% of your deposit. So your stocks will need to earn 4% value before you get back to where you started

Take note, though – there are a couple of important points to be aware of.

The first is that ISA’s come in at least two basic forms – often referred to as Mini and Maxi ISA’s.

The Mini ISA is effectively a form of high interest savings – you have a guaranteed savings rate, and again, it’s pretty high relative to current accounts. So a mini-ISA can make a good short-term investment.

The Maxi ISA is a direct investment in stocks and shares – so you’ll need to be in this for the longer-term.

That’s partly because your interest will only grow with the stocks themselves. But less obviously, when you invest you’ll likely find yourself immediately hit by a management fee – for example, 4% of your deposit. So your stocks will need to earn 4% value before you get back to where you started

The Maxi ISA is a direct investment in stocks and shares – so you’ll need to be in this for the longer-term.

That’s partly because your interest will only grow with the stocks themselves. But less obviously, when you invest you’ll likely find yourself immediately hit by a management fee – for example, 4% of your deposit. So your stocks will need to earn 4% value before you get back to where you started from.

The second point to be aware of with ISA’s and tax-free savings is limitations – with an ISA you can only invest a limited amount of money in them each year. So this isn’t really something you can use for larger lump sums.

Stocks and Shares

Stocks and shares are the mainstay of market trading – you buy into the equity of growing companies, on the grounds that as they continue to grow and perform well, their revenues increase, their company value increases, and therefore not only does the stock you hold grow in value – but you can also earn dividends – earnings paid directly to shareholders.

The problem with the equities markets, though, is one of risk. It is up to the individual investor to determine the level of risk that they feel comfortable with taking on board, and proceeding accordingly.

For example, investing a lump sum into a single company stock is extremely risky – it’s all eggs in one basket. Lessen the risk by investing in multiple stocks and also try to cover different market sectors – for example, financial services stocks, energy stocks, mining, airlines, retail, etc.

There are certain options to help make those decisions for you – such as Mutual Funds and Exchange Traded Funds. These will simply take your cash and spread it around a diverse range of stocks for you.

Of course, you can take a hands on-approach yourself, and try to choose your own stocks.

However, the big problem here is that in doing so, you take on all the risks, and you not be in apposition to properly ascertain what the actual risks you are taking. If you must do it yourself, at least use one of the many available “virtual investor”