Where do you put your trust?

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The Independent Online
AS STOCK markets throughout the world continue on their uncertain rollercoaster ride, investing one's hard-earned savings has never seemed so difficult.

Not only is there a rapidly growing number of funds, both unit and investment trusts, to choose from. There is also the tricky task of selecting an appropriate savings vehicle, one whose performance won't immediately dive once an investment has been made.

As those who risked money in Mexico last year know, it is not always possible to predict what will happen to a country's economy.

This supplement on unit and investment trusts gives some pointers as to what these funds can be used for, including paying for children's education needs, mortgages and preparing for retirement.

It also explains the differences between investment vehicles and how charges are levied on the funds.

A few points worth remembering:

q Although tax-saving considerations can be important, they are not always the most vital element of an investment decision. Personal equity plans are useful, but they should not form the only part of most people's balanced portfolios.

q Investing in a unit or investment trust is not like placing one's money in a bank or building society. It carries an element of risk.

q Spread, and minimise, that risk by selecting not just one fund but several, not just around the world but in British equities too.

q Not everyone's needs or their willingness to accept risks are the same. Headline growth rates can sometimes be deceptive, with all companies vying to give their - sometimes selective - versions of how well their funds are doing.

There are many specialist magazines providing more sober assessments. But if in any doubt, contact an independent financial specialist.

q An equity-based investment will not always deliver scintillating results, even with the best fund manager. Be prepared to take a long-term view - at least five years, more if possible.

And finally, invest wisely.