Attitudes towards investing in the UK have changed in recent years, and more people than ever are putting their wealth into the stock market.
Indeed, according to Finder, 54% of people in the UK had invested money as of 2024. This is an increase on 42% in 2023.
This increase in the number of investors may be because people have more access to information online to learn about investing and research our options. Additionally, retail trading platforms make it easier for you to invest your wealth.
However, picking stocks yourself could be a risky strategy, especially if you don’t have the knowledge and understanding to properly research investments. That’s why the Financial Times reports that around 70% of DIY investors lose money.
Fortunately, if you work with a professional, you may find it easier to grow your wealth and work towards your long-term financial goals.
Using a “Centralised Investment Proposition” (CIP) is one of the ways we can help you achieve this.
A Centralised Investment Proposition streamlines the process of choosing investments
When you develop an investment strategy, it’s important to consider your long-term goals and attitude to risk. You can then select investments that allow you to work towards your aims.
Yet, there are thousands of potential investment products that you could use. So, researching and performing due diligence on investments may be incredibly time-consuming. Additionally, you may be more likely to choose investments that don’t align with your goals and attitude to risk.
A CIP is a collection of approved investments that our advisers can choose from when creating your bespoke portfolio. Each investment is carefully selected and assessed to ensure that it is suitable for our clients and has the appropriate level of risk.
This framework streamlines the process of choosing investments as you pick from a smaller pool. Additionally, you can be confident that due diligence has already been performed on all investments.
A CIP may have several benefits for us and, more importantly, you.
Four ways a Centralised Investment Proposition could benefit you
- It frees up time to develop your financial plan
Your investment strategy is only one part of your financial plan. Without a CIP, we may have to dedicate a disproportionate amount of time to selecting and performing due diligence on lots of different investments. This could mean we don’t have as much time to focus on other areas of your financial plan.
Yet, the framework of a CIP makes the process of choosing suitable investments much quicker and easier. As a result, we can spend more time developing long-term goals, exploring your options for retirement, and creating a cashflow forecast.
Ultimately, this means that you’ll have a more comprehensive financial plan, and you may be more likely to achieve your dream lifestyle as a result.
- It makes it easier to design a portfolio that matches your appetite for risk
Investing can be an effective way to grow your wealth and achieve your long-term goals. However, you always adopt some level of risk when you invest. If you don’t carefully manage that risk when selecting investments, you could experience significant losses. In some cases, this might mean you have to make sacrifices to your lifestyle and forgo certain financial goals.
That’s why performing due diligence on investments is crucial, and a CIP ensures that the right precautions have been taken. Normally, an investment panel will choose suitable investments and meet regularly to update the CIP.
This means, together, we can choose investments with confidence, and it’s easier to successfully manage risk.
- You can more easily benefit from a bespoke investment portfolio
You may assume that a CIP makes it more difficult to create a bespoke portfolio because you’re choosing from a smaller pool of investments. However, this isn’t necessarily true because CIPs have evolved over the years, incorporating new technology to offer a range of customisation options.
You may be able to choose a preferred risk profile or consider specific investing preferences, such as a focus on sustainable options. Additionally, CIPs often have many reporting tools, giving you detailed information about your investment performance and your ability to work towards your long-term goals.
- Enjoy potentially lower fees
Finding ways to keep fees as low as possible for our clients is a priority for us. We want to provide a service for a fair price, allowing you to retain more of your wealth.
A CIP drastically reduces the amount of time it takes us to create a unique portfolio for our clients. As a result, we may find it easier to keep our services more affordable for you.
Get in touch
If you’d like to learn more about how a CIP could help you develop your investment strategy,
get in touch or email us at advice@mlifa.co.uk.
Please note
This blog is for general information only and does not constitute advice. The information is aimed at retail clients only.
The Financial Conduct Authority does not regulate cashflow planning.
The value of your investments (and any income from them) can go down as well as up and you may not get back the full amount you invested. Past performance is not a reliable indicator of future performance.
Investments should be considered over the longer term and should fit in with your overall attitude to risk and financial circumstances.