The Personal Finance series with Warren Ingram

Investing in tax free saving accounts? Make it a long term investment

When investing money, people try to spread out their investments as much as possible. Thus in the event of something going wrong with one investment, you do not lose all your money. But can you over-diversify your investments?

Warren Ingram, Personal Financial Advisor and Executive Director at Galileo Capital says diversifying your money as much as possible is not always the best decision.

A lot of the time, the temptation is not to have all of our eggs in one basket, so we but every basket we possibly can - and we fill it as much as we can. That is not always rational.

Warren Ingram, Personal Financial Advisor and Executive Director at Galileo Capital

What is important to note about a tax free saving accounts is they can hold an index tracker, they can hold an exchange traded fund fund, it can be a unit trust. So you are not restricted just to one type of investment in a tax free saving accounts.

Warren Ingram, Personal Financial Advisor and Executive Director at Galileo Capital

When you are thinking about investing into a tax saving account, Ingram says its good not be too diversified. But you should have sufficient diversification.

If you are putting money into tax free saving, make it a long term investment.

Warren Ingram, Personal Financial Advisor and Executive Director at Galileo Capital

It shouldn't be something that just generates interest for example, which is in a really short term - one to three year investment. You're looking for five to 10 year investments, which means largely shares.

Warren Ingram, Personal Financial Advisor and Executive Director at Galileo Capital

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