Everyone knows that money is one of the things university students worry about the most. Cash can be tight while at university, but if you can afford to save – either a regular amount each month or as and when you are able to – it’s definitely a very good move and will help to set you up for the future.
Most students have a regular savings account but there are also some investment opportunities that students might like to take advantage of. One of the best examples of this is the stocks and shares ISA. Everyone over the age of 18 in the UK is able to save a certain amount of money every year tax-free. This is done through an Individual Savings Account – ISA for short.
You can either choose to invest your total ISA allowance in stocks and shares or you can split it down the middle – invest half in stocks and shares and save the rest as cash. This can be a good option for students who are looking for a secure savings option alongside an investment opportunity.
One thing for students to be aware of when choosing an investment ISA is that the performance of the ISA is dependent on the market. Just like any other investment, your money can go down as well as up – this is why shares ISAs tend to be seen as a longer-term savings product. However, you can generally still get access to the money in your account when you need it, which is appealing to a lot of students. Also, there’s also the potential for you to earn really good tax-free dividends on your investment – so taking the risk could pay off, literally.
While there is some risk attached to a stocks and shares ISA, a well-managed fund has the potential to do well over the long term, and the ability to save part of your money as cash as well as making investments makes this a good option for students interested in investments.