With interest rates plummeting to record lows and rumours of negative rates on the horizon, many savers are shying away from traditional savings accounts and trying their hand at investing, though it remains important to hold enough for emergencies in accessible, risk-free form.

While the pandemic has caused financial difficulty for many families over the past year, others have been able to put more money aside as a result of spending less on non- essential items. Official figures3 show that the household savings ratio increased from 9.6% in Q1 2020 to a record high of 29.1% in Q2.

Saving vs investing

A total of £125bn was deposited into savings accounts last year, according to Bank of England data, and that figure is expected to rise substantially during the first half of 2021. Many people have therefore seen their savings balances grow at a time when savings rates have hit rock bottom, prompting many to turn their backs on cash and dip their toes into the investment waters.

The importance of advice

With so many funds available, the investment process can appear daunting and it can be difficult to know where to start. Working out a sound investment plan with sensible goals is key, as is seeking financial advice before you begin.

Invest over the long term

Investing should be a long-term commitment and it’s important to have a savings safety net in place before you start. Historically, while investing in equities has delivered better returns than cash, there is inevitably a risk the value of investments can fall. This means we need to establish your risk tolerance before recommending any investments.

Whether you’re thinking about your pension, creating an investment portfolio, a stocks and shares Individual Savings Account (ISA), or even a Junior Individual Savings Account (JISA) for a family member, we can help you begin your investment journey.

3UK Parliament, 2021

It is important to take professional advice before making any decision relating to your personal finances. Information within this page is based on our current understanding and can be subject to change without notice and the accuracy and completeness of the information cannot be guaranteed. It does not provide individual tailored investment advice and is for guidance only. Some rules may vary in different parts of the UK.

Equity release will reduce the value of your estate and can affect your eligibility for means tested benefits.

Tax and Estate planning are not regulated by the Financial Conduct Authority

The value of pensions and investments can fall as well as rise. You may get back less than you invested.

Will writing is not part of the Quilter Financial Planning offering and is offered in our own right. Quilter Financial Planning accept no responsibility for this aspect of our business.

CA Financial Services Ltd are an Independent Financial Adviser based in Sevenoaks, Kent. From our Sevenoaks offices, we offer IFA services throughout Tonbridge, Tunbridge Wells, Dartford, Orpington and across into Sussex and Surret. Please call us on 01732 617 950 to book a free initial appointment.

CA Financial Services offer financial advice, pensions, investments, ISAs, Equity Release and Inheritance Tax Planning for the whole family. We have 14 years’ experience as Financial Advisers based from Sevenoaks and are truly independent, allowing us to give our customers the best financial advice possible.