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Iceni Magazine | August 18, 2022

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Making Your Money Work for You: Simple Ways for Savers to Invest

Making Your Money Work for You

There’s definitely some truth in this kind of statement.

For example, current internet rates are at historical lows compared to a look back at history. Even with lower inflation, savings are losing purchasing power to the ravages of inflation. So, while saving is fundamentally good, monetary value failing to keep up with the rising cost of living isn’t helping anyone.

If you want to make your money work for you, then you could consider investing. Keep reading and we’ll offer some insight and inspiration.

Invest into a Side Hustle

To escape a job because of an interest that isn’t explored in the current position, an increasing number of UK people are working on side hustles. Some of these may eventually become a full-blown business opportunity while others may deliver extra savings and then die out later.

A side hustle can provide the opportunity to invest savings to increase the pot of gold after it’s all over. There’s a good degree of “sweat equity” in this too, so it’s not passive.

Fine Wine for a Touch of Class

For people who like a little tipple and are knowledgeable about wine, then fine wine investing is a possibility.

Many investors look to the Liv-ex 1000 index – it’s not investable directly at the last look but it provides historical data on theoretical returns.

Eager investors can invest in a wine fund but should be aware that fine wine has increased by 200 percent in a decade. One has to ask whether there are more grapes where that came from or if the taste will sour in the years to come?

Private investors can purchase bottles and have them stored in chilled conditions. However, this is a long-term approach and comes with considerable carrying costs when purchasing premium bottles, arranging for storage, insurance, and more. Some of these investors massage their egos saying, “I can always drink the wine if it comes to it.” But that hardly sounds like sound investing.

Individual Savings Accounts

Another way to invest savings is to use an Individual Savings Account (ISA). The idea is sometimes a confusing one because while it’s possible to use an ISA to just hold cash, many people choose to use a stocks and shares ISA for the potential (albeit not the guarantee) of greater returns.  

What is an ISA? It’s a savings account that allows you to save up to £20,000 per year without paying tax on the income or growth generated by the investments held in it. That means that, even if you make significant income or gains on your savings held in ISAs, you won’t have to pay capital gains tax or income tax.

If you want to learn more about ISAs and consider investing in one, then you need to check out all the options, including a stocks and shares ISA. These ISAs are a great way to invest in stocks and shares without the hassle. If you want to learn more, then Willis Owen has answered this ISA question with their What is a Stock and Shares ISA guide. It provides useful tips and ideas on how to use an ISA to invest for the future.

While no returns are guaranteed, investing in the stock market and, to a lesser extent, the bond market, has provided beneficial results for many investors when done steadily over long periods.

Lastly, avoid swinging for the fences and taking extensive risks. Careful savers that invest with a mind to not lose money can balance their investments to avoid steeper losses in bad years. This way, they live to fight another day.


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