Starting Investing? Finding investing scary? You are not alone!

According to a recent survey by Lloyds Bank, half of Brits are being scared away from investing their money, with 38% baffled by complicated jargon. Despite these concerns, 83% of Brits recognise the benefits of investing and want to start investing.

This blog post will demystify some of the words that put off beginner investors.

Let’s take a look at some of the scariest words out there, demystify them and get you, to start investing:

Despite dominating the headlines over the last year, 3 in 10 people said they didn’t understand “inflation”.

Inflation:  Inflation is the rate at which the general level of prices for goods and services is rising, and it is usually measured as an annual percentage increase. According to the Office for National Statistics, the UK’s Consumer Prices Index rose by 6.8% in the 12 months to October 2023.

Other common investing terms people are clueless about include:

Asset class (77%)

An asset class is a group of investments that share similar characteristics and behave similarly in the market. The four main asset classes are cash, fixed income, equities, and alternative investments If you invest in a ready made portfolio, it is likely to be a mix of all four of these. If you buy direct stocks (a share in a company) that is an equity.

Dividend (42%)

A dividend is a payment made by a corporation to its shareholders, usually in the form of cash or additional shares of stock. Dividends are typically paid out of a company’s profits. Some people invest purely for dividends – they use them as a second source of income! UK companies are ‘traditionally’ good dividend payers.

Stocks (37%)

Stocks, also known as shares or equities, represent ownership in a company. When you buy a stock, you become a shareholder in that company and have the right to vote on certain matters and receive dividends. If the companies share price goes up, you do well. If the share price goes down, then your shares are worth less.

Portfolio (37%)

A portfolio is a collection of investments held by an individual or an institution. Portfolios can include stocks, bonds, funds, exchange-traded funds (ETFs), and other types of assets . If you use our tool and select that you wish for someone to do it all for you… it is likely that you will be put into a ready made portfolio containing all of the above.

Let’s demystify the world of finance and help more people achieve their financial goals.  Last month we helped over 460 individuals begin their investment journey.

Feeling less overwhelmed?  Give our easy, free tool a go.

Let me know if you found this helpful!

 

• Investing for beginners. Start Investing.

• How to invest your money

• Financial jargon explained

• Inflation and investing

• Asset class, dividend, stocks, portfolio

• Financial education and tips