I’m no gambler – but I am prepared to accept risk

The information provided in this article was accurate at the time of publishing and should be read in the context of the date it was published. Views in this article are those of the author alone and do not necessarily represent the view of Scottish Friendly.

Game-changing, inspirational, thrilling and sheer magic are just some of the words that describe the winning of the English Premier League by Leicester City. Under the visionary and understated management of Claudio Ranieri the Leicester squad that has hit the news headlines the world over had been built up for around £57 million, a fraction of the cost of the usual league winners of Chelsea, Arsenal and the two Manchester teams.

For many of the midland team’s fans, not only have they had the most exciting unforgettable weekend, they have also made a tidy fortune in betting, at the start of the year, that their club would win the League.

The odds of Elvis being found alive and well were less than the 5,000-1 that was initially given for Leicester winning the League. One fan, Lee Herbert, told BBC Radio 4’s PM programme on Saturday (30th April) that he had waged a £5 bet and later cashed in £2 of that in return for a payout of £5,600 – no doubt under pressure by some of the bookies who were now becoming increasingly alarmed in direct proportion to the number of games Leicester were now winning. Nonetheless the remaining £3 of Mr Herbert’s has earned him a further £15,000 which he and his partner Kerry will now be able to place as a deposit for a much-longed for house of their own.

A good number of Leicester fans are equally happy citizens today both in terms of joy factor and financially. For most of us, however, what’s the likelihood of earning a decent sum of money by gambling?

Working hard to put money aside over many years is, for the majority of us, a more practical way of building up a lump sum to fund a major item in life like a house deposit.   When it comes to saving and investing for the future, two of the most common alternatives are putting money in a cash deposit account or ISA or investing in stocks and shares, often through an ISA.

There is certainly risk attached to stock market investments. Their value can go down as well as up and investors are not guaranteed to get back the amount originally invested but if investors go about things the right way, it’s not so much a gamble as a calculated risk. A gamble involves placing a bet on a potential outcome and is a zero sum game; it simply transfers wealth from one to the other. Investing for the future in stocks and shares is a longer term and more considered course of action. It’s one that, while involving risk as detailed above, aims at creating winners all round by sharing any potential benefits between industry, you the investor and the fund managers in various proportions but the point is, when you look at the whole, unlike with a bet, the economy is better off.

Leicester City’s fans’ faith in their club was vindicated this weekend in a once-in-a-lifetime occasion. For most of us however, hard slog and educated decisions concerning saving and investing is the more likely way we’ll come close to having sufficient money for the things that matter in life.

No advice has been provided by Scottish Friendly. If you are in any doubt as to whether a savings or investment plan is suitable for you, you should contact a financial adviser for advice. If you do not have a financial adviser, you can get details of local financial advisers by visiting www.unbiased.co.uk. Advisers may charge for providing such advice and should confirm any cost beforehand.