There will always be some bumps along the way and that is the nature of investing. This won’t change. One of the best pieces of advice that was given to me many years ago now and that I always remember, is that:

if you are waiting for a better time to invest, you will always be waiting.

Typically, it hasn't been the easiest ride over the past few years. Just as there seemed to be some light at the end of the tunnel coming out of the pandemic, it is unlikely anyone expected a war. The Ukraine situation is a tragedy and one that could have lasting consequences. This has only served to exacerbate the sharp rises already being seen with the cost of living situation post pandemic and it is also likely there will be more economic ups and downs to come. However, if history has taught us anything, it is that markets can overreact in the short term but be resilient over the medium to long term. 

When markets seem to be taking a turn for the worse, it is essential to hold your nerve and remain focused on your strategy. We need to be wary of the opposite too. When investors get carried away, prices can rise to unsustainable levels like we saw in the dotcom bubble of the late 1990s. As ever, all investments can fall as well as rise in value, so you could get back less than you invested. Highs and lows in a market are nothing unusual. If you are looking to invest or add to your existing portfolio of investments, a falling market can offer opportunity. History has shown that buying when valuations are lower can push the odds in an investor's favour and yield a greater chance of profit. Ask yourself, have you ever looked back and thought if only I had invested at that point? That point will have most likely have been during an economic downturn of sorts.

The key here is that tough times don't last forever.

It is important for investors to remain resilient when markets are jittery. Make sure you are happy with the level of risk across your investment portfolio as the more risk you take, the larger the potential volatility you could experience.

Making multiple investments in the same asset class e.g. property can only give you so much insulation if that sector goes out of favour. So as long as you are diversified in multiple asset classes, what you buy isn't always the most important factor - how much you invest and for how long are far more significant considerations. Start early, keep reviewing, keep adding. Be patient, be diversified and let time do the hard work for you.

While uncertainty and volatility are two trending topics across financial markets right now, one element of certainty we do have is the cost of living crisis. The cost of living is a measure of people's 'real' incomes. It covers a range of different items from household bills to wage growth and taxes. Inflation is currently the main threat. 

UK taxes have risen too. In times like these, it is more important than ever to make the most of the tax advantages available. The more money you can shelter away from tax, the harder it can potentially work for you. Where it is right for your circumstances, make sure you utilise the opportunities where you can e.g. ISAs and pensions. Although, tax rules can change and benefits depend on personal circumstances, by making your investments as tax efficient as possible, you could be improving your returns at the very start of your investment journey.

If you would like advice on how to plan your investment strategy, including help in setting and achieving your objectives, please contact one of our advisers for a complementary consultation.

Although every effort has been made to ensure that the information provided in this article is accurate and correct, the information provided does not constitute any form of financial advice. We recommend that you take financial advice before making any financial decisions.