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Don’t get mad, get even

There was a time when I’d get quite upset looking at my bank statements. Banks, utility and insurance companies, lenders and mobile phone companies, all robbing me silently by direct debit. From time to time, I’d hear their names mentioned on the news. Record profits, yet again – billions! Astronomical numbers that I couldn’t even start to comprehend. Whilst the rebellious part of me said “boycott the lot of them!” I knew that this was unrealistic. Sadly, we are all at the mercy of the big powerful companies that run our lives and it’s pointless getting mad. Perhaps it’s time to get even. Here are 5 steps to take.

1: Make a list of the companies that make a killing out of you

How do you feel when you hear that one of the big energy companies you pay on a monthly or quarterly basis has made record profits yet again for an overpriced service that is often well below par? I certainly don’t like it. The first step towards getting even is to look at your bank statement and make a list of all those firms that profit out of you. List them in order, with the biggest “offender” at the top.

2: Buy their shares!

You might find that you have a different attitude as a shareholder in those offending companies. You’ll want them to do well and might actually smile when you hear news of their resounding success! Brexit and recent market corrections mean that the share prices of some of the big companies are deflated. This is great news for those buying shares now.  Your prospects for capital growth are greatly increased when you buy shares at a discounted price.

3: Spread your risk and think long term

Many people are tempted to buy the shares in a sector they understand – for example Utilities or Banks. Worse still, some people invest all their money in the shares of a single company they may like or be familiar with. This can be dangerous. The results can be dramatic If all your eggs are in one basket and the share price falls heavily.  Much better to diversify, thereby spreading your risk. Do this by investing in the shares of a number of different companies and sectors that aren’t related to each other. Shares also require patience, so think long term. Ten years is a good time benchmark to work to.

4: Get an expert to make your decisions for you

With thousands of shares available to buy in the market, knowing what to buy and when to buy can be bewildering. And when do you sell? For a lot of people, it’s pure guesswork; many shareholders purchase or sell when they have the time or when it’s convenient. The more scientific approach would be to employ the services of a stockbroker or fund manager. Typically, a stockbroker would wait for you to give them instructions to purchase or sell, whilst a fund manager would listen to your brief and buy and sell shares for you as and when they saw fit. Either way, the experts are less likely to get it wrong than you are.

5: Beware of tax

If you decide to buy shares, it’s very possible that you will make money from them. Most shares also pay dividends which you can re-invest or receive payment for. Regretfully, HMRC are no fun at all and will want a healthy slice of your gains. Thankfully, there are ways of sheltering your gains from tax, for example, purchasing your shares through an ISA or Self Invested Personal Pension. Your best bet is to team up with an Independent Financial Adviser, who will help you keep your gains away from the sticky mitts of the taxman. The time has come to get even.


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