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Staying in cash - a high risk strategy


Holding too much cash is a high risk strategy that will destroy your long term wealth.

Despite recent interest rate rsies, no deposit savings rates provide above inflation returns.

Even with inflation as low as 2% your purchasing power will halve over four decades.

A big challenge for our clients, and all investors, is that all the financial news is so short term and sensationalised. We construct long term financial plans for our clients but we also account for short term shocks so that they can stay invested and wait for the upturn. Short term shocks will happen and will again in the future. Waiting for inflation to fall, fear of investing or trying to time markets is not a sensible financial plan.

I still don't know any better way to future proof our clients' wealth than by allocating capital to the world's best companies in low-cost index funds and empirical evidenced investment strategies. Trust the process and ignore short-termism.

The information in this email is provided in good faith without any warranty and is intended for the recipient’s background information only. Past performance is no guide to future performance. Your fund value can go down as well as up. 

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