Why is investing your money so important? Your long-term financial goals, your children’s future, or your financial security for your retirement, can all be helped hugely by investing. It’s a powerful tool that can make it easier for you to achieve your desired financial objectives.
Recent economic and political events provide an effective counter to the previous statement. But it is always vital to remember that investing is a journey, and just like any other journey, there will be bumps along the way; it’s not always smooth sailing.
Volatility is a natural part of any investment journey and any investor should understand this. For example, one week, the value of your portfolio may fall, and just a few days later, it may recover and increase to a level it had not reached previously.
The key is long-term thinking, more time gives your money the ability to grow. Fluctuations in global markets will always happen, but if you give your money time to ride out these fluctuations, you can get a lot out of investing and harness its power.
Long-Term Investing is Crucial
For example, let’s examine some data between January 1971 and July 2022. If you randomly picked just one day during this 50 year period to invest for the allotted 24 hours only, you would have a 52% chance of increasing your money according to Nutmeg. These near 50/50 odds obviously aren’t that appealing, it would be like tossing a coin.
However, investing not for just one day but for any one year between those dates above would increase your finances 72% of the time. But again, you could do better; investing for ten years would increase your chances of generating a positive return by 94%. Those odds are a lot better than tossing a coin. This demonstrates that the longer you invest, the more likely you are to see your finances improve.
Of course, it’s always necessary to point out that past performance is not a guarantee of future performance. When we analyse whether investing is an effective tool, we can only look at probabilities and broad trends.
There are no guarantees that your money will increase, only that it probably will if you invest long-term. Therefore, it’s always a good idea to make sure you have emergency funds ready in case you need access to money quickly.
Why Brite is the right choice for you
Investing has to be a long-term undertaking if you want to get the most out of it, so starting earlier can help your chances of reaching your financial goals. This is particularly true when it comes to investing your pension – saving for retirement should never be subject to short term market movements – in fact it’s better to do nothing and leave pension money alone – just let it gradually grow over time.
We believe that investing with Brite is the right choice, as our investment philosophy is based on taking the long view and thinking about protection first, as nobody knows what’s around the corner.
You can also choose the level of risk you’re comfortable with, and we will provide you with a portfolio that meets your requirements. You get access to highly qualified asset managers that determine the best way to invest your portfolio and maximise value over time.
Market volatility is a regular occurrence, and by looking at the bigger picture, there is evidence to show that long-term investing can be a viable and smarter strategy for growing your money.