There’s something very satisfying about saving money over time to put aside to achieve a goal in the future. There are many investments that are available, each of which offers a potential return which can beat inflation. It’s important to take into consideration the different types of investment and how they fit with your overall financial goals, particularly your tolerance for risk.
Investments and funds
A fund is a collective investment in which your and the other investors’ funds are pooled and placed in a variety assets. This spreads risk because you don’t depend on the performance of one type of asset. For example an UK equity fund is made up of shares from different British companies.
You can also find funds that cover a variety of asset types, or sectors that are more specialized. There’s a fund to suit each investor, no matter what level of experience and investment timeline, or their risk tolerance.
Bond funds are a well-known choice of investment. They are made up of IOUs or debt, typically issued by government agencies or companies. They are less volatile than stocks. However, they could be affected by interest rate changes and the credit rating of the issuer.