Where Does It Go? - UK Money Blog £

The act of committing money or capital to an endeavor (a business, project, real estate, etc.) with the expectation of obtaining an additional income or profit. Investing also can include the amount of time you put into the study of a prospective company, especially since time is money.

Unless you are unusually wealthy, investing usually occurs if you come into a sum of money that has no immediate use. The sum of money usually comes from inheritance, bonuses or even lottery wins! A pension could be regarded as a kind of investment done on your behalf. I’m talking here about those investments you are more directly involved with.
If you do come into a sum of money, its usually always more beneficial to pay off outstanding debts before investing or saving, although the power of compound interest is strong, so long term it may be worth investing to maximize your return when your investment matures. This depends a lot on your circumstance, so financial advice is recommended.

If you have a sum of money, the banks are usually falling over themselves to offer you rates, so take your time and pick what you feel the most comfortable with; flashy salesmen are the norm in this sector. I went with my bank, which was a mistake - its almost always better to for to an IFA since the banks will sell you their own, often inferior, products.

In the UK, it is usually worth including an Individual Savings Account, or ISA in your investment. These are investment packages set up by the government which guarantee tax free savings. Usually when you invest any income from the investment can be taxed as income tax - ISAs are the exception. Currently you can invest £7200 a tax year (6 April to 5 April).

Equities is another term often used in investments - these generally mean stocks and shares within a company and bonds. Stocks are riskier since they can go down in value if the company is doing badly, bonds are like a mortgage made to the company - they offer dependable income but if the company does fantastically well the share holder will share in that wealth - bond owners will still get only a fixed payment. Bond owners are also the first to be paid in case of any liquidation and so are regarded as more secure. Government bonds are taken out against the wealth of a country, and so are generally regarded as a very safe investment.

Check out the top investing news below:

If you know the stock quote, get the current trend below: