Save or Invest - Don't Make the Wrong Choice

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[adamp]

I began my higher earning years in 2007 and kept piling what I could into the markets (mostly SP500 low cost mutual funds as ETFs weren't common yet) - I listened to the experts who said to keep at it over the long haul and the sums involved were low enough that I didn't mind the ride. Annual returns going back to then are 10.5%, which I'm happy with.

[Billclint-if]

As an investment enthusiast, I often wonder how top level investors are able to become financially stable, I do have a significant amount of capital that is required to start up but I have no idea what strategies and direction I need to approach to help me make over $400k like some people are this season.

[JannyLuits]

Diversification is the secret to optimal performance. This is why I have my interests set on market sectors based on performance and projected growth, such as the EV sector, renewable energy, Tech, and Health. Keep investing regularly and you'll be blown away how much it can change in a few short years. Here's to $1 million and to FIRE

[uncountableuk]

Saving is deferred consumption. Investing is for wealth accumulation.

You just have to pick which you want.

[LawrenceTimme]

Everyones investing in stocks but the people in the know just buy freddos and keep them 10 years and sell them at over 200% profit 😃

[richell]

It’s all a balance. Saving and investing is not binary. Do a bit of everything.

[CraveThatCoin]

I'm sure you missed this out to keep the video simple but the fredo bar along with virtual all products did change. It got smaller which is another form of inflation which is known as shrinkflasion. So the true inflation is the price rise + the lost size from shrinking.

[DomS]

I only save for short term goals like a new (but used) car. And of course keep my emergency fund in cash.

Everything else goes to investments, however mostly going into pension right now

[philzvids]

This is a timely video for me as I was debating whether to put more money into my cash ISA or stocks ISA. The cash ISA is currently looking very attractive (both with T212).

[davothefirst]

Good explanation of the effects of inflation !

[bonditltd]

Whilst I’m still working and not spending as much, I’m paying off mortgages, despite the fact they are <4%, which seems crazy. But future cash flow when I’m retired is more important. I’ll not pay the 2% mortgage off until the end of the fix and will use all my ISA allowance as global funds and savings to the max until I reach the taxable limit, then it goes into pensions, premium bonds and assets.

[richard]

It would be good if you could say a few words about tax reports - ease and clarity, from the main player sites 2-1-2, Invest Engine, etc. Tax reporting is a reality and you definitely need ease of access and real clarity in this minefield that is the UK tax system.

[Definetly_not_a_BOT]

Minute 4.44 on UK aggregate or compound inflation.
Where does the 37.8% come from? I got 23.9%

Annual Inflation Rates in the UK:
2020: 0.85%
2021: 2.6%
2022: 9.1%
2023: 6.8%
2024: 3.0% (forecasted)

The compound inflation rate over the four-year period (2020–2024) is approximately 23.9%

1. Convert each percentage into its decimal form:
2020: 0.85% → 1.0085
2021: 2.6% → 1.026
2022: 9.1% → 1.091
2023: 6.8% → 1.068
2024: 3.0% → 1.030

2. Multiply the adjusted rates:
(1.0085) X (1.026) x (1.091) X (1.068) x (1.030) = 1.2394

3. Subtract 1 to get the compound inflation:

1.2394 - 1 = 0.2394 or 23.94%

[richell]

Most of our cash rainy day savings are in an offset account against our mortgage. Mortgage interest is 3.13% fixed for a further 3 years. This made sense the last 20years. I can set the offset as reduced term or payment. Currently it saves me £100 a month on the mortgage payment. That £100 goes in to a LISA and is topped up by Gov 25% bonus.
I’m worried about devaluing the offset cash with it not growing in line with inflation.
Now I can get 5% in other savings accounts but I love the ease of access currently.

[OldQueer]

I have access to credit which would cover me for a year in an emergency. I also have a paid off house to use as security if things go completely wrong.

To balance this, I keep cash value of a year's emergency fund in MMFs. Everything else gets invested. It's slightly higher risk since all of my liquid capital is at risk, but it suits me.

[Abdul_Rahman]

I will always choose investing.
That’s just me personally. I find that money is constantly being diluted and depreciates over time.
I’ve been meaning to ask, where did you get that stocks and shares diplay??

[meenakshi]

Hi Toby, thanks for the great video! Just wanted to ask if I invest in Cash ISA (trading 212) could I make future investments for my children- like for example deposit for their house? Or do you think Junior ISA, which has a lower interest rate is the better way? Thank you

[JustBens]

Have you done / or can you do a video explaining IRR or specifically Vanguards 'Personal Rate of Return' %? and what it actually means? I kind of think its comparable to what interest rate an imaginary bank would have given me to equal the return with the same amount of investments on the same dates...or something??🤔

[Lucas-wnwm]

I dont save much. I just invest in my local untaxed dividend stocks and some US bluechips. Gonna add more spy etf for thr remainding of this year and next year.

[julesflack]

Great content as always Toby, thanks! Good to listen to with a morning coffee ☕😊