Remember that old story about the tortoise and the hare? How the latter zipped off, ran out of steam and was eventually overtaken by the steady-but-less-spectacular performer?
Well when it comes to savings and investments, long-term investment plans could be a good way to ensure you’re a winner in the end too.
Yes, patience is a virtue in this race — and options like 10 and 15-year investment plans may be a good idea for any would-be tortoise.
Forget hare-brained speculations and trends. Generally speaking, the longer you invest, the better you should be able to weather unpredictable economic bumps in the road.
Investors tend to enjoy better returns over the long-term, plus the final payout is a carrot which should tempt any tortoise.
And one of the other big advantages of long-term investments is that you get used to putting money aside every month. Saving and investing becomes a habit — and a good one.
Whether it’s Junior’s university fund or first flat deposit, or a round-the-world cruise, it’s never too early to think of the future and play the long game.
Ok, so you want to invest tortoise-style. What next?
Well, there are plenty of wallet-friendly options that will set you on the road to saving and investing.
But, unlike the hare, you have to be willing to stay the distance for the full 10 or 15 years. Drop out early and your returns could be disappointing.
MoneyBuilder is a 15-year investment plan from Scottish Friendly for anyone aged between 16 and 59.
You start by putting in from as little as £10 a month, which then rises by 20 per cent a year over the first five years to help your investment grow.
As you work hard, so does your money. It’s invested in a range of assets including the stock market, bonds and property, with the aim of long-term growth. And remember — as your money is invested in the stock market, the value of your investments can go down as well as up and you may get back less than you paid in.
At the end of the plan you get a payout which the taxman can’t touch — no matter what tax bracket you’re in. Tax treatment depends on your individual circumstances and tax law may change in future.
Plus you get life cover included too, which ensures your loved ones receive your investment, plus any bonuses, if the worst should happen.
Prosperity is another scheme in which the tax is paid now, meaning the taxman won’t get a sniff when you cash it in after 10 or 15 years. Tax treatment depends on your individual circumstances and tax law may change in future.
You can put away between £15 and £100 a month, with Scottish Friendly again investing it in assets aimed at long-term growth.
You also receive life insurance, plus a guaranteed minimum cash sum after 10 or 15 years, which hopefully will have grown thanks to the addition of special bonuses. The amount of your guaranteed minimum cash sum depends on your age and how much you pay in. It will initially be less than your total investment over 10 or 15 years.
Used up your stocks and shares ISA allowance? Then Scottish Friendly’s OEIC provides the choice of two funds managed by stock market experts.
You put in as little as £15 a month — or a lump sum from £500 — and the experienced professionals do the hard work and invest it in the market. However, you must aim to contribute for at least five to ten years to see the best results. The value of investments and the income from them can go down as well as up and you could get back less than you have paid in. The value of your investment is not guaranteed.
Scottish Friendly’s UK Select Investment Plan is another stock market-related investment scheme, in which you can invest between £15 and £100 a month for 10 years in some of the UK’s biggest household names.
Again, you get life insurance and a tax-free payout, although, of course, like the other schemes above — and like anything linked to the stock market — the value of your investments can go down as well as up and the value of your investment is not guaranteed.
So there you have it. Tempting though it is to make a quick buck like the hare, go slow and steady like the tortoise and you’ll hopefully have plenty to shell out later.
(See what I did there?)