Investment advice

It is important to understand the difference between savings and investments. Savers usually want a safe place for their money where they can get at it easily. Investors tend to want their money to grow by at least the rate of inflation and accept that it may be ‘tied up’ for some time.

Investment principles

There are two basic principles when you invest your money:

• The greater the risk, the greater the potential for reward or loss.
• The greater the ease of access, normally the lower the reward.

Before you invest, think about whether you could get back less than you originally invested because of changes in the financial market.

Also be aware that if you give your money to someone else to manage and invest, there is a danger you could lose it because of mismanagement or fraud. It is vital to look carefully at the strength and reputation of any financial company you are considering investing with.

Never risk any sum of money you cannot afford to lose.

Seeking financial advice

If you have money to save or invest we recommend that you seek professional advice from an independent financial adviser. Only ‘authorised’ financial advisers can advise on certain types of investment, including pensions, life assurance, shares, unit trusts and ‘lifetime mortgage’ equity release schemes.

The Financial Services Authority (FSA) authorises such firms. To check that a firm is authorised phone the FSA Consumer Helpline on 0845 606 1234 or look on their website (see 'Useful website') and follow the Firm Check Service link.