Investment Common Mistakes

Investment mistakes are easy to make. We hope these pointers will show you what not to do. Take a look at the ‘Investment Tips’ section, which will guide you through the ways to avoid mistakes.

Mistakes People Make

• Holding onto a with profit bond purely because there is a penalty for encashing.

• Using an insurance company’s ‘managed’ fund.

• Not reviewing investments on a regular basis with an adviser. As a result, what was a balanced portfolio at the time of set-up, can quickly become unbalanced.

• Couples can often have assets held in the wrong way and pay unnecessary tax that cannot be reclaimed.

• Insufficient available cash is left in emergency funds.

• Taking excessive risks with investments to achieve a potentially higher return, when an overall “helicopter” view has to be taken to help spread the risk.

• Buying investments off the page, or through different parties which takes you away from a cohesive “financial strategy plan” and leaves you with a lot of unconnected purchases and no protection from poorly designed products.

• Investing in the top fund of the month, quarter or the year. In the investment world, it is important to look for a longer, steadier track record as you are not investing for the short-term.

• Investing too soon. If you have debts to pay, clear these first.

• Many investors get caught chasing the dream and put all their eggs in one basket, such as Technology funds or Gold investments.

• Investors are often told to use onshore investment bonds. These are tax-inefficient and pay 20% tax as they grow. An equivalent is an ISA or unit trust could be tax free if within the capital gains allowance.

• People buy when markets are ‘good’ (high) and sell when they are ‘bad’ (low), this is the reverse of what you should do.

• Holding multiple funds in various places causing administrative havoc and valutaion problems.

• Most investors don’t know the underlying risk within their investments until markets collapse.

Find out why so many people choose Worldwide Financial Planning as their Investment adviser by calling 0800 0112825 or complete the enquiry form in confidence.

Worldwide Financial Planning – Investment Adviser of the Year, Ethical Investment Adviser of the Year