Retail investing boom set to continue

With the retail investing boom showing no signs of slowing down, we look at the golden rules of investing and how to start share dealing.

The content of this article was relevant at the time of publishing. Circumstances change continuously and caution should therefore be exercised when relying upon any content contained within this article.

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The pandemic has changed the way we view and handle our money. Household savings in the UK have climbed to an all-time high. As a result, retail investing is booming.

A recent study by Barclays Smart Investor found that UK investors plan to increase their monthly investments by 19%, despite restrictions now having been lifted.

And it looks like the retail investing boom is here to stay. Let’s take a look at the current trend, some golden rules for investing and where to find an investment platform that suits you.


Retail investing boom

According to Clare Francis, director of Barclays Smart Investor, “the pandemic has changed our approach to saving and investing.”

Months of not being able to go out and spend money has led a number of Brits to see what else they could do with their money. And it looks like many are now exploring the benefit of saving and investing.

Barclay Smart Investor’s research found that 76% of UK investors plan to continue with their lockdown investing habits, with 50% planning to cut back on spending in order to continue investing.

Only 4% of first-time pandemic investors were planning to give up their new hobby once all restrictions are lifted.

And it is the younger generation driving a lot of the retail investing boom. In fact, Gen Z investors are looking to invest 36% more each month post-lockdown.

Golden rules

If you are an investing newbie, it can all seem a bit daunting. Investment carries risk, and it can be hard to know what options to pick.

So here are a few golden rules if you are considering investing some of your lockdown savings:

  • Have an emergency cash buffer: It’s important to build an emergency cash savings pot before committing money to investing. This can help you to cover any short-term needs or unexpected costs.
  • Think long-term: Investing isn’t about short-term gains. The market can be quite volatile, so as a general rule, you should try to commit to at least five years in order to ride out any fluctuations.
  • Diversify: You can reduce your risk by spreading your money out across various companies, regions and industries. The hope is that if one investment drops in value, the others may rise and offset any potential losses.
  • Use your tax allowances: Try to take advantage of what a Stocks & Shares ISA can offer you. Each tax year, you will receive an ISA allowance which allows you to deposit up to £20,000 completely tax free.
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Picking an investment platform

Whether you are a seasoned investor or new to the world of retail investing, finding an investment platform that suits your needs is key.

If you have been investing for a while, then you may want to look at a platform that has low trading costs, a large range of investment options and solid resources and learning materials. Alternatively, if you are a newbie investor, you may want something that is a bit easier to use with ready-made investment fund options.

Whichever type of investor you are, we have gathered together some of the top providers of online share dealing brokerage accounts and online share-trading accounts for beginners.

Our reviews look to break down the platform fees you can expect to pay and any share dealing charges. They also highlight any additional features that we think add value.

But remember, past performance is no guarantee of future returns. And unlike cash, the value of investments, and any income from them, can fall as well as rise. If you are unsure about retail investing, it’s best to seek independent financial advice first.

Should you invest, the value of your investment may rise or fall and your capital is at risk. Before investing, your individual circumstances should be assessed. Consider taking independent financial advice.

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