The Motley Fool

Stock market crash: Just £100 a month could help you get rich from UK shares and retire early

Image source: Getty Images.

Can you afford not to invest in UK shares today? My answer is an emphatic no! I’m not trying to give you the hard sell. I don’t have to. The many acres of column inches that illustrate how the State Pension is in increasing jeopardy does that for me.

Investing in UK shares might not just save you from pensioner poverty. It may even allow you to get rich and possibly hang up your work apron early. I myself continue to build a balanced portfolio of quality UK shares to help me eventually retire in comfort. And the recent stock market crash provides us with all with an opportunity to build a retirement-boosting stocks portfolio at very little cost.

5G is here – and shares of this ‘sleeping giant’ could be a great way for you to potentially profit!

According to one leading industry firm, the 5G boom could create a global industry worth US$12.3 TRILLION out of thin air…

And if you click here we’ll show you something that could be key to unlocking 5G’s full potential...

Senior couple at the lake having a picnic

Making big money with UK shares

So how much money do you and I need to have built up to live a comfortable retirement?

According to financial services platform Unbiased, someone who wishes to retire with an annual income of £20,000 will need to have built a pension pot of £170,000. That comprises the maximum £9,110 per year that pensioners can claim through the State Pension and the weight of their own savings pots.

I think that most of us could live in relative comfort on £20,000 a year. But it probably won’t allow you and I to live the life of retirement luxury that we may have been dreaming of. And this is where that £100 a month invested in UK shares comes in.

Say you’re 25 years of age and invest a century every month in something like a Stocks and Shares ISA. By the time you come to retire at the age of 65, you’re likely to have built a mighty pension pot of between £322,000 and £555,000. That’s based on studies that show long-term investors in UK shares tend to make an average annual return of between 8% and 10%.

Fancy retiring at 58?

These are the sort of sums that would allow you and I to go on that once-in-a-lifetime holiday, give the kids a financial boost, buy a new car, frankly do whatever we pleased. But this is not the only benefit of buying UK shares. For those happy to retire on a little less, they could ditch the day job years before the vast majority of people and still retire in comfort.

That person who invested £100 a month in UK shares from their mid-20s could, based on that 8% to 10% formula, expect to have made at least £181,000 if they retired at age 58. This would allow them to achieve that £20,000 annual income that would give them a comfortable retirement.

It’s never too late to start investing in UK shares to try and get rich or retire early. The financial pages are often replete with stories of individuals who have made a fortune after they began investing in their 40s or 50s. And there are plenty of investment guides and reports from experts like The Motley Fool to help you carve our a comfortable retirement.

5 Stocks For Trying To Build Wealth After 50

Markets around the world are reeling from the coronavirus pandemic…

And with so many great companies trading at what look to be ‘discount-bin’ prices, now could be the time for savvy investors to snap up some potential bargains.

But whether you’re a newbie investor or a seasoned pro, deciding which stocks to add to your shopping list can be daunting prospect during such unprecedented times.

Fortunately, The Motley Fool is here to help: our UK Chief Investment Officer and his analyst team have short-listed five companies that they believe STILL boast significant long-term growth prospects despite the global lock-down…

You see, here at The Motley Fool we don’t believe “over-trading” is the right path to financial freedom in retirement; instead, we advocate buying and holding (for AT LEAST three to five years) 15 or more quality companies, with shareholder-focused management teams at the helm.

That’s why we’re sharing the names of all five of these companies in a special investing report that you can download today for FREE. If you’re 50 or over, we believe these stocks could be a great fit for any well-diversified portfolio, and that you can consider building a position in all five right away.

Click here to claim your free copy of this special investing report now!

Royston Wild has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

Our 6 'Best Buys Now' Shares

The renowned analyst team at The Motley Fool UK have named 6 shares that they believe UK investors should consider buying NOW.

So if you’re looking for more stock ideas to try and best position your portfolio today, then it might be a good day for you. Because we're offering a full 33% off your first year of membership to our flagship share-tipping service, backed by our 'no quibbles' 30-day subscription fee refund guarantee.

Simply enter your email address below to discover how you can take advantage of this.

I would like to receive emails from you about product information and offers from The Fool and its business partners. Each of these emails will provide a link to unsubscribe from future emails. More information about how The Fool collects, stores, and handles personal data is available in its Privacy Statement.