Have any of you ever tried to get people to start investing and get frustrated at the lack of confidence many have to do so?
I spoke to a work colleague and said: So do you save or invest? He replies: âOh no donât invest just save. Itâs too risky, all you need to do is save budâ itâs funny how much Investing appears to be gambling for many.
I normally say to people that you canât get away from risk. Having currency in a bank account is risky, it devalues over time with inflation and can devalue based on politics. So you may as well look at the risk vs reward of different ways to invest savings.
I agree, itâs weird though because these same people gamble in casinos/bet on horses/buy lotto tickets & scratch cards constantly but investing is a No-Go for them. Itâs like an instilled fear.
I know risk averse people who store ÂŁ30k in the bank instead at interest rates beginning with 1.x. They think theyâre not taking risk, but their international spending power has depleted by 19% over three years by having all their wealth stored in one (currently out of favour) currency (GBP), and their savings rate is below the BoE inflation target. Net result of this âlow risk strategyâ = poorer over long term.
I think it is understandable that people are âfearfulâ of the stock market as for the average person most of what they hear about the stock market is probably in the news giving negative stories. Vanguard funds donât really generate breaking content, for good reason.
And you guys in the UK are lucky with the ISA. In Ireland there is nothing like that.
Achillesâ point is such a major reason to invest. Inflation! Cash is a terrible investment unless saving to buy an asset in the near future.
Robert Kiyosaki gets a bad rap sometimes but he definitely taught me to think about assets and liabilities in the proper way. And to aim for passive income
Iâve been trying for years to get my friends to invest but they still see it as gambling - they have all their wealth sitting in cash ISAs!
How investing and the stock markets are portrayed in the news puts many people off - either the Wolf of Wall Street raking in the millions or someone losing it all because they had all their money on one stock.
There are never headline stories about the people who regularly invest in diversified stocks/ETFS/, steadily growing their wealth, because frankly itâs not very exciting clickbait news.
The old finance industry establishment also continues to try to make investing seem more complicated than it actually is to justify their high fees.
Its more risk being out of the the maket then being in it