The Scotsman has 10 investment tips “you can bank on”:
- If you must play the market, don’t speculate to satisfy some emotional need. Recognise this behaviour as gambling.
- Avoid tipsters.
- Remember, most tax shelters are high risk. The reason you’re allowed to shelter tax at all is simply to encourage you to invest – often in things you would otherwise avoid.
- Be wary of treating your home as an investment.
- Never invest in anything you don’t understand or which cannot be clearly explained to you.
- Be alert to how stockbrokers work. If a stockbroker manages £10 million, to earn his £100,000 salary, he must typically generate £300,000 in gross commission – that’s 3 per cent of the money. So, there is a need to keep your money turning, earning commission on every piece of “advice”.
- Don’t invest in off-the-page advertising launches. They have no track record and often have more marketing than investment substance.
- Write out your short, medium and long-term goals and stick with them.
- Don’t forget about inflation.
- The most financially successful people tend to save at least 20 per cent of their income.