The complete guide to investing for beginners

The complete guide to investing for beginners

Investing in the stock market is widely seen as one of the best ways to generate a return on your money. As a result, you may be considering trying to take your first steps on your investing journey.

Of course, the trouble is that it can feel like there’s a lot to consider before you can get started.

You may be unsure of how to find accurate information to base your investment decisions on. Or perhaps you’re unsure of what types of assets and investment vehicles will be right for you as a novice investor.

This could put you at risk of losing money, especially if you end up choosing investments that aren’t appropriate for you.

That’s why, if you’re new to investing, it’s important to do your research and understand what you’re buying before you dive into the stock markets.

So, from how to choose an investment platform, to some of the different assets that first-time investors could consider, find out everything you need to know in my guide to investing for beginners. 7 of the best investment platforms for beginners UK

There are various stockbrokers and investment platforms in the UK that are ideal for beginners.

Below is a selection of my top picks for the best platforms to invest with in the UK. The 5 steps to starting investing for beginners

It’s remarkably straightforward for beginners to start investing. 1. Choose a stockbroker or investment platform

First, you need to choose a stockbroker or investment platform to facilitate your investing.

There are a number of stockbrokers and investment platforms available in the UK. Choosing the right one for you will depend on a variety of factors, such as trading costs and how much money you want to invest. 2. Choose an investment account

Next, you need to choose an investment account.

From general investment accounts to ISAs, there is a range of different accounts available. Search for the most appropriate account for you based on your investing needs. 3. Work out your investment goals

Once you have an account, decide what it is that you want to achieve with your investing.

Are you looking to supplement your income in the short term? Or are you actively saving for your future, perhaps targeting returns that will support you in retirement?

Your investment goals will determine a great deal of your investing, including the strategies you can explore and the types of assets you choose to trade. 4. Set your investment strategy

With your goals in mind, decide how you’re going to get there. Research different investment strategies and figure out which of these will work best for you.

Just as it is for veteran investors, it’s often sensible for beginner investors to target gains in the long term, rather than trying to turn a quick buck. 5. Start trading your investments

Once you have a strategy in place that targets your goals, you can start buying, selling, and trading investments.Make sure to do your research into your investments before you buy. Choosing the right investment account Next, you need to choose an investment account that suits your needs.Stockbrokers and investment platforms offer a variety of accounts to choose from. General investment account A general investment account, also sometimes referred to as a “share dealing account” or a “GIA”, is the most basic type of account, allowing you to trade a variety of investments, typically with no limits.Some brokers now offer their most basic accounts for free, including no commission on your trades.However, investing in this type of account can leave you with a tax liability, depending on how much you generate. ISAs An ISA (standing for “Individual Savings Account”) is a type of personal account that allows you to hold money and investments tax-efficiently.Each tax year, you have an ISA allowance for how much you can save into your ISAs . For the 2021/22 tax year, this amount is £20,000.Crucially, when you hold investments within the ISA “wrapper”, it means you won’t be subject to Income Tax or Capital Gains Tax when you come to sell any of your investments.This means that you can keep the money that your investments generate, rather than having to pay tax on it.There are various types of ISAs, each with its own benefits:One of the most common types of investment ISA, a Stocks and Shares ISA allows you to buy and sell investments within your ISA wrapper.You have full control over the investments you choose, allowing you to buy and sell them as you see appropriate, all while sheltering them from Income […]

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