If you want to invest in the stock market, you have a number of options.
Read Annie Shaw's guide to common investment mistakes.
The most direct way is by buying shares in individual companies, but you can also put money into investment funds that hold a much wider portfolio of shares or other assets.
To put money into shares, you need the help of a stockbroker or share-dealing service. There are a number of online firms that now offer low trading fees, but check in advance how much you will be charged.
What is investment risk? Read our guide.
You may face charges for inactivity – that is, periods when you aren’t buying or selling — and people who make more frequent trades may get charged less per trade.
Check that any stockbroker or share-dealing service you are considering is registered with the Financial Conduct Authority (FCA).
Saga Share Direct, provided by Equiniti Financial Services Limited, is a low cost share dealing service with no annual account management fees and flexible trading options. Some investment types may have their own fees. Aged 50 or over and would like more information?
Shares are high‐risk investments. Share prices and the income from them can fall as well as rise and you may not get back the full amount invested. Saga Share Direct does not offer advice. If you are unsure whether this service is suitable for you, please consult a financial adviser.
If you want to invest in a wider range of companies, you can choose an investment fund, such as a unit trust or investment trust. Such funds are run by expert managers who decide on their investors’ behalf when to buy and sell shares.
You can put money into funds directly through the fund manager, although it is often cheaper to do so by using an investment platform or “fund supermarket”.
Funds come with a range of fees, such as initial charges and ongoing annual management fees, so check what these are going to be before you invest.
Could you be sitting on a fortune?
As well as the fees, look at the other information about the fund listed in the Key Facts or Key Investor Information documents: this should tell you what type of shares or assets the fund invests in, and whether it is considered high-, medium- or low-risk.
Again, any company you do business with should be listed in the FCA’s register. Find out in advance how you can keep tabs on your investment, and whether you will face any charges for cashing it in.
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Watch out for scams
Criminals and conmen frequently set up dodgy investment firms to persuade people to part with their money.
In some cases, this will be to invest in unsuitable, high-risk ventures – for example, overseas land purchases – while in the worst cases, the fraudsters will simply take your money and disappear.
Beware of being contacted with an “investment opportunity” out of the blue, and be particularly cautious if you feel someone is putting pressure on you to make a quick decision.
If you are suspicious or just unsure about how an investment works, either seek advice or walk away.
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