Salvation for hard-up savers

Last month's rise in inflation is a rude reminder of the need to ensure that savings do not fall behind prices. Low interest rates have meant that many building society savings accounts are failing to do this.

So if you want your savings to do more than just keep up with inflation, and are prepared to take some risk in the pursuit of higher returns, you should consider investing in shares.

Over the years, shares have proved to be one of the best ways of making money. But there are risks involved. You might invest in a company whose profits shrink, rather than grow, or which even goes out of business. The way to avoid such exposure is to invest in a number of different companies so as to spread the risk. But this needs a lot of capital.

The simple solution is to pool your savings with other people's, and find an expert to decide in which companies they should be invested. That is the basis on which unit trusts and investment trusts operate.

Here and on pages 16 to 19 we explain how they work, how to choose them and how to invest in them.