Pity first-time house buyers. Having finally seen the ladder lowered from the great property juggernaut in 2008, most could still only scramble on-board with a loan from the Bank of Mum and Dad.
And as mortgages have become easier to get in 2009, house prices have shot back up, reversing the UK house price crash before it had barely begun.
Some 45% of house purchases in May 2009 were by first-time buyers – a huge number by the standards of recent years. But by November the percentage was down to 19%, according to the National Association of Estate Agents.
Wouldn’t it be great if you could reduce the risk of investing in the stock market – or in gold or oil or any other risky asset?
People pay a fortune to hedge funds that claim to reduce the risks of investing – but can you do it yourself?
In this article I’ll introduce some techniques used by hedge fund managers and others to ‘hedge their bets’ when investing.
It’s not just me who feels about as sorry for bankers having their gravy train upset as I feel sorry for cancer cells that eventually kill their host.
A nice rant on The Motley Fool today goes in for some rumbustious banker bashing, too.
Yesterday I related the tale of D., my friend who reached out to a financial adviser, only to get his hand wedged in the door of the adviser’s getaway vehicle as it sped from the scene of the crime, leaving incomprehensible documents and 7% fees fluttering in its wake.
What advice should D. have got instead? Where should he put his money?
Firstly, he should have got an education.
Perhaps financial advisers should be forced to give out general advice and simple literature explaining the basics of investing (such as costs and compound interest) before they’re allowed to sell any products.
At the very least, a client shouldn’t leave more confused than when they went in.
As for saving for the future, I’m not an adviser, but when asked how to get started, I usually suggest a super-simple cash and index tracking combo, all held in tax-free accounts (ISAs in the UK).
A case study: A few weeks ago, my friend D. decided he should start putting aside some money for the future.
A bohemian sort in his late 20s and without any savings, D. has no fixed career, let alone a pension. But things are going okay for him right now, and he thinks he can save £100 a month.
Not much, but a start.
D. also has the usual British aversion to money, which means he knows absolutely nothing about saving or investing and wrinkles his nose at the thought of learning more.
Now, I’d be the first to say he should take responsibility for his own financial future and start reading up on this stuff for himself.
In fact I’ve said so in the past – which is probably why instead of talking to me he instead went to a family friend, a financial adviser who’d advised his uncles.
