"Every study on long-term financial returns reaches the same conclusion: inflation is the investor's enemy and there is a cost to holding cash for long periods."
"From 2004 to 2024, cash generated a return of minus 40.5% in real terms, while a diversified portfolio increased by 21.6% in real terms."
"It is slightly ridiculous that the colossal sum of 610bn is estimated to be sitting in cash savings in the UK; it can't all be rainy-day money."
Savvy Squirrel is a new character promoting investment awareness, supported by the chancellor and financial services. The initiative encourages individuals to avoid holding cash in ISAs due to inflation's negative impact on returns. Historical data shows that cash investments have significantly underperformed compared to diversified portfolios. The campaign aims to engage retail investors and stimulate the capital markets, addressing the large amount of cash savings in the UK that could be better utilized for investment opportunities.
Read at www.theguardian.com
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