Brits favour investing in shares over low-interest savings accounts

Chalk outline of two arrows pointing in opposite directions

While there is no denying the popularity of savings accounts in the UK, a recent survey shows that Brits are now shifting their saving and investing preferences to other options. More specifically, research shows that a good number of Brits currently favour trading and investing in stocks and shares over low-interest savings accounts. Here is the full scoop.


Investing in shares: what does the research show?

Findings from a survey commissioned by show that the UK is becoming a nation of online armchair traders. Brits are increasingly choosing to trade and invest in stocks and shares online rather than receive potential returns from low-interest savings accounts.

Almost four in ten survey respondents (38%) said that they are trading or investing in stocks and shares online at home or have done so in the past. Around a fifth (21%) mentioned that they are considering it.

More than half (52%) of respondents who are currently trading or investing in stocks said they chose to do so because the potential returns are better than savings rates offered by banks. A further 44% believe that online trading is a convenient way to earn some additional income.

According to the research, most people prefer trading online themselves. The two main reasons given by respondents are that:

  • It is cheaper to do it themselves than to go through a traditional bank (37%)
  • They cannot afford an independent financial adviser IFA (35%)

The study also discovered a gender divide when it comes to investing. More men (47%) than women (29%) are currently trading in stocks and shares or have done so in the past. However, around the same number (21% of men and 20% of women) are considering doing so in the future.

What are Brits’ main reasons for investing in shares?

The survey respondents’ main reasons for choosing to trade stocks and shares online include:

  • Planning for the longer term and saving for retirement or their future (41%)
  • Trying to make up for lost earnings due to Covid-19 (24%)
  • Fear of missing out on the current global stocks bull run (21%)
  • Headlines about GameStop armchair investors (20%)

Of those who said that they would not trade stocks and shares online, 48% said that they did not know enough about online trading to do it themselves. A fifth (20%) said they were afraid of being charged a lot of fees to trade.

Interestingly, just 7% said they would not trade online themselves because they only trust IFAs or banks to do so. Meanwhile, 59% said they don’t trade online themselves because they consider it too risky.


What’s the takeaway?

According to Jonathan Squires, CEO of, the survey “raises the important question about whether traditional sources of financial management are offering value for money. There is a clear willingness for people to take matters into their own hands by trading and investing in stocks and shares directly online, themselves.”

Squires adds that the internet has broken down barriers to education and investing. For example, the internet has made it easier for people to find information on what they can do with their money, including how to make it grow faster.

Furthermore, the rise of online share dealing and stocks and shares ISA platforms means that investing is now more accessible than it’s ever been. You can literally begin trading stocks and shares in minutes and with the simple click of a few buttons.

Why should people be cautious about investing in shares?

Savings rates are currently at an all-time low. It’s therefore not surprising that Brits are turning to other alternatives that can make their money work harder for them. As the survey by shows, stocks and shares are high on many people’s list of preferred investments.

History shows that investing in stocks is one of the most dependable ways to build wealth in the long term. However, the stock market can be volatile. Your investments can fluctuate in value. You might even get back less than you invest.

Consequently, Squires advises Brits to be cautious: “Even as savings rates remain low and questions persist about how they can make their money grow, it is important that people understand the different risks associated with online trading versus a savings account.

“Savings should not be used to replace trading, and people should only trade with money they can afford to lose, and even then, they should invest for the long term.”

The post Brits favour investing in shares over low-interest savings accounts appeared first on The Motley Fool UK.

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