Deciding what to invest your hard-earned money in can be a difficult choice, especially for beginners.
If you’re new to investing, we recommend that you start small. There are many different types of investments available in the UK that are perfect if you’re looking to start with modest amounts of money instead of a huge lump sum.
Whether you’re looking for short-term gains or aiming for long-term growth, the key is to start small and grow steadily.
But what are some of the best small investment vehicles in the UK? That’s what we’ll be exploring in this blog post. Read on for some of the best small investments in the UK, with a range of options to suit different risk tolerances.
10 – Trading Apps
Trading apps can be a great way to start investing. There are many user-friendly trading apps to choose from so you can start investing in shares and exchange-traded funds (ETFs) with ease.
You can usually start trading with small amounts of money with these apps. They are an accessible entry point into the world of trading and investing. Not all trading apps are reputable – so take some time to explore the different options out there, and be sure to check the reviews.
9 – Property Crowdfunding
Property crowdfunding is an innovative way for you to invest in the property market without the hefty price tag of buying a property outright. Typically, you need a large lump sum to invest in property. You’ll need to cover the initial deposit and be accepted by a mortgage broker.
However, if you pool funds with other investors, you can access the property market with a small amount of money.
Investing in property can be a great way to diversify your portfolio. You can expect potential returns through rental income. You can also profit from property value appreciation – the property may increase in value over time, meaning you can reap the profits when it’s time to sell.
Property investment, however, has many considerations. There may be additional costs to consider such as property management services and valuation fees. Property prices can vary depending on the location too – for example, investing in London may be more expensive than investing in other areas of the UK.
8 – Pension Accounts
Depending on your age, pensions could seem like a distant concern. However, regardless of how far away you are from pension age, it’s always good to start your pension contributions early.
Pensions are an investment into your future and can ease any future financial concerns when you reach retirement.
Many employers offer pension schemes. Contributing to them not only helps you save for the future but also provides tax benefits in the present. A financial advisor can help you make the most out of your pension, and help you prepare for your future.
7 – Investment Funds
Investment funds are collective investment schemes that pool money from various investors to invest in a diversified portfolio of assets.
These funds are managed by professionals. This makes them a great option if you’re a beginner looking to benefit from diversification without the need for active management.
Unlike many other types of investment, you can employ a ‘hands-off’ approach with investment funds. You don’t need expert knowledge of financial markets to utilise investment funds.
6 – Shares ISAs
Stocks and Shares ISAs allow you to invest in individual company shares within a tax-efficient wrapper.
Buying shares is a great way to become a shareholder in companies you believe in without the tax implications that can come with direct share ownership.
It’s a flexible and accessible option if you want to get started with stock market investments.
However, like with most investments, when you invest in the stock market, there is a risk that you could lose money.
5 – Regular Savings Accounts
If you would prefer a more traditional, disciplined investment, why not opt for regular savings plans? Explore the different products available – fixed-term/fixed-rate accounts may have favourable interest rates.
If you invest a fixed amount per month into your investment account, you can make the most of compounding interest. This approach can also reduce the impact of market volatility on your returns.
4 – Peer-to-Peer Lending
Peer-to-peer lending platforms connect borrowers with individual lenders. This approach cuts out the traditional banking intermediaries.
By participating in peer-to-peer lending, you can earn interest on your money while directly supporting individuals and small businesses in the community. It’s a win-win situation that provides financial returns and contributes to the growth of local businesses.
3 – Low-Risk Bonds
If you’re looking for a low-risk investment, bonds can be a great investment opportunity. Explore the different government bonds and corporate bonds to find the best fit for you. These provide a stable investment platform, offering fixed interest rates over a predetermined period.
Low-risk bonds are a great choice if you’re a beginner looking to start small – you can expect low-risk and predictable returns with this type of investment.
2 – Investment ISAs
One of the most popular and tax-efficient small investments in the UK is an Investment ISA – an Individual Savings Account.
Investment ISAs offer a wide range of investment options, from stocks and shares to bonds and funds. These accounts can provide a tax-free environment for your returns.
If you utilise your annual ISA allowance in the right way, you can grow your wealth whilst enjoying tax benefits.
1 – Art Investment
Finally, we have art investments. Art investment is a great investment if you’re looking to start small – you can invest in art with as little as £3,000 with Grove Gallery.
Art is not generally a short-term investment – instead, it’s something that you may need to hold on to for a while before seeing an increase in value. If long-term investing is your style, art investments may be the right choice for you.
It is a potentially lucrative alternative investment. At Grove Gallery, you can invest in luxury art from prominent blue-chip artists, expecting returns of around 12% per year.
This not only adds a touch of culture to your investment portfolio but also diversifies your risk across different asset classes. Art can be a great addition to your investment portfolio. It’s something that stands tall in times of recession and economic uncertainty.
Additionally, art is something that you can enjoy. Unlike ISAs and pension accounts, art is a tangible investment. It’s something you can touch and feel; something that can bring you joy.
Art is easily one of the best small investments in the UK. Begin your art investment journey today with Grove Gallery.