So you want to build a personal savings portfolio but don’t know where to start? We are all being encouraged to save for our futures, while at the same time many of us feel discouraged by low interest rates and returns on our savings. Critically, many of us see the value of our savings over time, just not keeping up with inflation –  we feel that what we put away shrinks in real terms, rather than growing. What’s the point in saving for something that will actually turn out to cost more later on – why not buy now?

Every day we are offered ways of making more of our savings and investments, mailed to us by post or on the internet. But the bottom line is that we do need to get in the savings habit. Nationally, individuals are being pushed towards self-sufficiency, particularly when it comes to providing for our life in retirement or to meet future needs within families, like higher education for our children. Without savings and investments we will struggle and anything is better than nothing.

We have to have some long-term thinking to be in the savings and investment game for the duration. There are short-term alternatives – investments that will give quick returns… if you’re lucky! All you need to do is gamble and be lucky, however the down side of the short term risk in gambling is that more people tend to lose their money than make a profit. So the lottery, the horses and bingo would not make for a sound savings and investment portfolio, although ‘a small flutter’ might be permitted! Such investments are at the high end of the risky ventures scale, perhaps only exceeded in risk by Nigerian investment bonds, money changing service and savings plans.

Building a mixed portfolio is something many enjoy, something which from time to time we have to look at, and fiddle with to stay on the top of our game. Looking for the best rates and returns, with the cheapest arrangements for switching and then making changes can be quite exciting – perhaps not so exciting as watching the horse race finish or the wheels spin, but enough for the more sober and ordinary of us.

There’s nothing wrong with starting small, in fact putting off saving until you have a critical lump sum to start with, might be self-defeating, although counting the pennies in the large sweet jar can be quite satisfying. But don’t let this cash saving start to grow into stuffing bank notes under the mattress – this is not interest yielding and can be a risk to life and limb.

How about looking at some of the following for your portfolio?

  • Instant access accounts (internet & branch) with variable rates which enable you to get at your money when you need it.
  • Cash ISAs (instant access and fixed) to earn your interest tax-free.
  • Fixed-rate bonds for the best accounts over a fixed term (usually higher rates here).
  • Monthly income (including cash ISAs), if you are a pensioner who needs regular income from savings.
  • Phone or postal accounts for those unhappy to visit branches or use the internet.
  • Junior ISAs and children’s accounts – start your portfolio early.
  • National Savings & Investments – all the top deals from the Government.
  • Offshore accounts – best for expats and those abroad.