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  • Eugen Neagu

Unlocking Wealth: How Non-Investors Can Thrive by taking Advice

Introduction

Investing can seem like a daunting task, especially for those who have never dipped their toes into the financial markets. However, there is good news: non-investors can significantly improve their financial well-being by seeking assistance and taking the leap into investing. In this article, we explore how financial planning can empower non-investors to build wealth and achieve their financial goals.


A recent survey carried out by Interactive Investor discovered:

  • Investment Hesitation: 78% of UK adults don’t invest, with a higher percentage among women (84%) compared to men (72%).

  • Knowledge Gap: The main reason for not investing is a lack of general knowledge (22%), followed by fear of losing money (20%) and market volatility (12%).

  • Age Factor: Young adults are most willing to invest, with 56% considering it but hesitating due to reservations, compared to 45% of those aged 35-54 and 34% of over-55s.

  • Support for Investors: Nearly half (48%) would likely invest if they received help with portfolio management to match their financial objectives and risk appetite.

Reference: moneyage.co.uk

 

1. Overcoming Fear and Uncertainty


The Fear Factor

Non-investors often harbour fears related to investing. These fears might include:

  • Risk: The fear of losing money prevents many from investing.

  • Complexity: The stock market seems like a labyrinth of jargon and numbers.

  • Lack of Knowledge: Non-investors worry that they lack the expertise to make informed decisions.


The Role of Guidance

Seeking help from financial planners, advisers, mentors, or online resources can demystify the investment process. Financial planners provide personalised advice, explain concepts, and guide non-investors through the initial steps. Education is key: lifetime cashflow forecast, understanding risk, diversification, and long-term strategies reduces anxiety.


2. The Power of Compound Interest


The Magic of Time

Non-investors often underestimate the power of compound interest. Even small investments, when left to grow over time, can yield substantial returns. By seeking help, non-investors learn about the importance of starting early and consistently contributing to their investment accounts.


Advice Matters

Financial planners emphasise the value of consistent contributions. They help non-investors set up automatic transfers, ensuring that money flows into investment accounts regularly. This disciplined approach accelerates wealth accumulation.


3. Diversification and Risk Management


The All-Your-Eggs-in-One-Basket Dilemma

Non-investors might hesitate due to the fear of putting all their money into a single investment. Guidance teaches them about diversification—spreading investments across different assets (stocks, bonds, real estate, etc.). Diversification reduces risk.


The Role of Advisers

Financial planners assess risk tolerance, life goals, financial objectives, and time horizons. They create diversified portfolios tailored to individual needs. Non-investors would benefit from this expertise, avoiding common pitfalls.


4. Behavioural Finance and Emotional Discipline


The Emotional Roller Coaster

Investing triggers emotions—fear, greed, panic. Non-investors often make impulsive decisions based on feelings. Advice helps them understand behavioural biases and develop emotional discipline.


Advisers as Emotional Coaches

Financial planners act as emotional coaches. They encourage non-investors to stay the course during market volatility, avoid panic selling, and focus on long-term goals. Emotional discipline leads to better outcomes.


5. Starting Small and Scaling Up


The First Step

Non-investors can start with small amounts. Seeking help allows them to open low-cost investment accounts, explore fractional shares, and gradually increase their exposure.


Guidance for Scaling

Financial planners guide non-investors on scaling up. As confidence grows, they can allocate more funds, diversify further, and explore advanced investment vehicles.


Conclusion

Non-investors need not remain on the sidelines. With financial planning and advice, they can unlock the doors to wealth creation. Whether through financial planners or advisers, educational platforms, or mentorship, seeking help empowers non-investors to take control of their financial futures. Remember: investing is not reserved for the elite—it’s a journey accessible to all.


At N2 Asset Management we hold Corporate Chartered status which is the the gold standard in financial planning. We have undergone a rigorous qualification process and adhere to a strict code of ethics, ensuring we operate with the highest level of integrity and knowledge. We are equipped to provide sophisticated financial planning services, including tax, investment, and retirement planning, as well as more specialised services like comprehensive wealth management (which include estate planning) and also philanthropy.

So, if you’re a non-investor, consider reaching out for assistance. Your financial future awaits!


Disclaimer: This article provides general information and does not constitute financial advice. Always consult a qualified financial professional before making investment decisions.  your investments will go up and down and you may receive back less than you put in.

 

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