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Where You Should Invest Your Money (And The Pitfalls To Avoid) To Set Yourself Up For A Prosperous 2025
As we enter the new year, many of us are looking to make our money work harder. With interest rates expected to fall and inflation likely to rise, investing wisely is more crucial than ever.
As Mail’s wealth guru, I’m often asked where people should be putting their cash in 2025. And my answer is: it’s not all doom and gloom out there. While there are certainly risks involved, there are also plenty of opportunities for growth.
But to achieve that growth, you need to avoid the pitfalls. In this article, I’ll outline the areas where investors should be putting their money – and more importantly, the potential traps to steer clear of.
Gold: Not a flash in the pan
First up, gold is an area that’s seen significant interest in recent times. And it’s not hard to see why. With inflation rising and interest rates expected to fall, there are concerns about the value of traditional investments such as stocks and bonds. Gold, on the other hand, has historically performed well during periods of economic uncertainty.
Coombs notes that around 20 per cent of their assets in gold-price related funds. He believes that investors should be wary of overexposure to any one asset class, but suggests that a diversified portfolio with some exposure to precious metals could prove beneficial.
UK gilts: A defensive play
Another area that’s gained momentum is UK gilts. Coombs recommends investing in these bonds as a defensive play, citing attractive income ahead of interest rate cuts in the coming year.
He believes that investors should consider putting up to 10 per cent of their portfolio into this asset class. This could provide a predictable return in an unpredictable market.
The pitfalls: Avoid getting caught out
So what are some common mistakes that investors should avoid? First and foremost, it’s essential not to get caught up in the hype surrounding certain investments. Just because something has performed well in the past doesn’t mean it’ll continue to do so.
It’s also crucial not to put all your eggs in one basket. Diversification is key in today’s market, as it reduces risk and allows you to capitalise on growth opportunities elsewhere.
Finally, investors should steer clear of anything with exorbitant fees or high-risk profiles. With the global economy still grappling with uncertainty, it’s essential that investors keep their wits about them and don’t get caught out by hidden dangers.
Where to put your money
So where should you be putting your cash in 2025? As I’ve outlined above, there are several areas that could provide attractive returns. But before we delve deeper, let’s quickly touch on a few other areas to avoid.
It’s not all doom and gloom out there, as some experts believe that the UK stock market could still be a viable option for investors in 2025. However, it’s crucial that you do your research and understand the potential risks involved before making any decisions.
In conclusion
Source: http://www.dailymail.co.uk
