A recent event in London highlighted growing efforts to encourage more people in Britain to invest their money, moving beyond traditional savings accounts that often fail to keep pace with inflation. The event, hosted by Times Money at the News Building, featured discussions by financial experts on how to overcome common barriers to investing and build long-term wealth.
The campaign, which aims to increase the number of investors by one million, also seeks to introduce investment education in schools and promote parental investment on behalf of children. At the sold-out seminar, specialists including veteran investment journalist Ian Cowie, financial psychotherapist Vicky Reynal, and Maike Currie, head of personal finance at PensionBee, addressed audience questions on investment strategies, managing risk, and psychological factors influencing financial decisions.
Cowie emphasized that investing in the stock market generally offers better returns than cash savings over time. Citing a Barclays Capital study of equity and gilt returns dating back to 1899, he noted that shares outperformed deposit accounts about 75% of the time over five-year periods. However, he acknowledged that market volatility is inevitable and advised investors to prepare for downturns by visualizing potential losses and revisiting the reasons behind their investment choices.
Reynal explored the emotional dimensions of investing, pointing out that attitudes toward risk and money management are often shaped during childhood. She explained that early family influences, such as observing parents’ reactions to stress or messages about who should invest, can create internal conflicts that discourage people from committing to investment plans. She highlighted that many women, in particular, may grapple with ingrained beliefs that investing is a “man’s world,” which can affect confidence and participation.
To mitigate the impact of market fluctuations, Cowie recommended the pound-cost averaging approach, where investors gradually invest fixed amounts over time rather than making lump-sum purchases. This strategy allows investors to buy more shares when prices are low and fewer when prices are high, often resulting in a lower average cost per share and reducing the emotional strain of trying to time the market.
Currie cited the benefits of directing spare funds into pensions, emphasizing the advantage of tax relief as a means to grow savings more efficiently.
The event underscored both the financial and psychological aspects of investing, stressing the importance of education, emotional resilience, and long-term planning for individuals seeking to build wealth in an environment where inflation often outpaces returns on traditional savings.