Income and Capital Growth

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O ne classic investment objective is income and capital growth. It sounds idyllic. After all, money on deposit is currently earning less than nothing in real terms. Indeed, even if interest rates were to go even higher, and we were to spend the interest, the real value of our capital would still decrease because of inflation. Apart from 'rainy day' money, allowing financial resources to languish on deposit is silly because of inflation. And its effect is insidious.

This is the conundrum that all investors face but the effect of inflation is more significant for retired people because, without earned income, they are totally dependent on their pensions and investments to meet costs of living.

It is for this reason that an investment strategy capable of delivering income and capital growth, over the medium to long-term is essential. According to individual client situations, arrangements can include various types of pension and also non-pension vehicles. NB Such arrangements must be viewed over the medium to long-term, through multiple economic cycles. Economic cycles typically last for about five years but, exceptionally, have lasted up to 10 years (1991 - 2001), (1961 - 1969). The recessionary part of the economic cycle is typically short-lived, of between six and 15 months.

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For those still working: Good stewardship of resources during our working life is a positive stepe towards a more secure financial future. This could bring the option to retire early or greater freedom in our career choices. Or, perhaps hobbies and travel is your thing? The key to a more successful outcome is to have a plan. The professional services of — The Harvest Partnership Ltd — could prove invaluable.

For those who are retired: the opportunity to maintain the value of their capital against the effect of inflation by saving from earnings has largely gone. And to make matters even more challenging, as well as maintain the value of the capital in real terms, whatever the money is invested in must also deliver income. In other words, it has to maintain value and earn its keep. Just the maintenance of the value of one's capital in real terms is challenging, but to do that while delivering income needs skilled advice based on experience.

The answer is asset-based investments. Because...

● Assets are buoyed by the very inflation that whittles away at the real value of cash deposits.

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● In addition to their growth potential, some asset types conveniently offer a meaningful level of income.

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F or most people, investing in asset-based investments is the logical solution to the pressing problem that most investors recognise – that of how to combat the effect of inflation whilst delivering a good level of income. In other words, how to make your money work for you.

Our clients know instinctively that they should use asset-based investments because they know it is only these that are buoyed by inflation.

Even if you are “risk averse,” there are still many investments opportunities that could be just right for you. There are ways to invest that are specifically designed to smooth the 'ups and downs' while potentially still offering a better return than the building society.

Everyone can enjoy the benefits of investing, providing they approach it in the right manner. The key is to take advice that has been tailored to your situation. And to work with an adviser who will help you make the arrangements from a fully informed position.

Not all investment advice is created equal. You owe it to yourself to take professional advice from the Company with the experience required to ensure that your investment strategy is absolutely right for you.

  — The Harvest Partnership Ltd —  has specialised in delivering good client outcomes* for over 25 years.

*Based on historic performance. Investments are medium to long-term arrangements and future performance cannot be guaranteed.

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