A third of Brits want to invest their savings this year to make their money work harder for them amid rising inflation

By Richard Jenkins
Friday, 31st December 2021, 10:27 am
Updated Friday, 31st December 2021, 10:27 am

A study of 2,000 UK adults revealed more than half (52 per cent) have never put their money into anything other than a regular savings account or a cash ISA.

One in five (21 per cent) still believe investing in the stock market is only for ‘Wall Street Banker’ types and 46 per cent are worried about losing their money.

More than a quarter (27 per cent) admit a lack of understanding in how to invest has been putting them off, while 30 per cent worry they won’t understand the financial jargon.

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Although 35 per cent don’t feel like they have enough spare money to invest.

But with rising inflation and low interest rates causing frustration for 27 per cent of those polled, 42 per cent are now looking for alternative ways to grow their wealth in the new year.

And nearly one in five (18 per cent) want to be braver with their money in 2022.

Stocks and shares

As a result, 24 per cent are planning to invest in a stocks and shares ISA in the coming 12 months, 19 per cent are exploring other ways of investing in the stock market, and 17 per cent intend to invest in property.

One in 10 (13 per cent) are even considering investing some money in cryptocurrency while eight per cent plan on putting their money into precious metals.

It also emerged that despite this shift towards investing, 94 per cent feel that having a rainy-day fund – to the tune of £8,400 on average - is important.

Charlotte Oates, a spokesperson from the saving and investing app Moneybox, which commissioned the research, said: “Many of those polled do not feel confident about investing their money, which is understandable given how overwhelming it can be to get started.

“Growing up we were never taught how to save and build wealth for our future and investing was only ever an option for the wealthy few.

“In recent years, investing has become so much more accessible to everyone and it’s really encouraging that so many are considering being proactive with their finances to make their money work harder for them, as unfortunately, relying on interest rates to grow your money over the long term isn’t currently an option.

“We are committed to doing all we can to help savers become confident investors by providing a range of simple investing options to get you started and tools like the Moneybox Investing Academy.

“Over eight lessons, you can learn all about stock market basics, through to asset classes and tracker funds, before finishing with key concepts like compounding and pound cost averaging.”

Money milestones

The research also highlighted significant resilience among consumers, with 73 per cent confident they will reach their money milestones this year.

While the pandemic brought many challenges, 47 per cent are now committed to bolstering their cash reserves for a rainy day, while 35 per cent are prioritising saving and investing more than they did before.

Nearly three in 10 (29 per cent) are planning ahead more than they were previously and 17 per cent intend to put more money towards their pension this year.

But 50 per cent admit to being concerned about the impact that rising costs of living could have on realising their goals, while others worry about unexpected costs (43 per cent), and pandemic-related issues (27 per cent).

In order to be able to put more aside to achieve their goals, 39 per cent plan to spend less this year on the things they don’t need and 28 per cent are going to budget more.

Others polled via OnePoll plan to sell things they don’t need (28 per cent), shop second hand (19 per cent) and go out less (10 per cent).

Charlotte Oates from Moneybox added: “The challenges of the last few years have prompted us all to re-evaluate certain aspects of our lives.

“When it comes to your finances, setting clear short, medium and long-term goals will help you feel more confident, in control, and ready to weather any storms along the way.

“Once you’ve built up a cash buffer for emergencies and unexpected costs, investing can be a great way to beat inflation and grow your money over the long term.”