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1. You’ll look after your own interests better than anybody else
Since the financial crisis in 2008 and the subsequent multi-billion-pound UK government bailout, it’s understandable that many people have less confidence in banks than they used to.
Couple this with almost non-existent interest rates on savings accounts and I believe there is a growing argument for taking more control of your personal finances. Sure, you could consult a financial advisor but, in my opinion, you’d be better keeping your money in your pocket and doing the research yourself.
Luckily, these days the information you need is at your fingertips with just the click of a mouse and it’s much easier to learn than it used to be. There has never been a better time to take control of your finances. Check out our good reads page. These books have made a massive difference to the way I think about and invest my money.
2. Tax Incentives
There are some very attractive tax incentives for those who earn money from investing which have been introduced by the government. Self-Invested Personal Pensions SIPPs and Stocks and Shares ISAs coupled with annual capital gains allowances make self-investment a very appealing prospect.
I suspect you’re probably thinking the very same thing otherwise you wouldn’t be reading this article.
3. The future is uncertain
Another good reason to start investing is that self-investment and financial awareness are key to ensuring your future will be as comfortable as possible. The traditional way of managing your money and reliance on a single form of income isn’t the only way. Frugality and hard work will only get you so far. The knowledge that your money can make you money is what allows the wealthiest people in the world to grow ever richer.
Failure to effectively plan and manage your finances will undoubtedly leave you with less than you’d like at retirement. State pensions will continue to shrink and may well be a thing of the past by the time you retire as populations, life expectancy and government debts continue to rise.
The recent rise in inflation and the cost-of-living squeeze should be evidence enough that if you’re standing still, you’re actually getting poorer. If you don’t know how much money you’ll have when you retire, I urge you to find out. Don’t be surprised if it’s a lot less than you think.
4. Getting started is much easier than you might think
The good news is that the ability to change this is well within your grasp. Investing isn’t brain surgery although it should change your mindset if you do proper research about the subject. It’s time to get your ducks in a row, assess the situation, learn new skills and make some solid financial plans for the future. Check out our beginners guide to investing for more information
If you’re fortunate enough to be in your twenties and reading this article, then working into your sixties may be something you can easily avoid. If, like me you’re middle aged then the very least you should aim for is reasonable wealth in retirement.
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