When will savers begin to invest their money?

In years gone by one of the key factors when considering investing your savings was the return available in investment markets and the return available in the savings market. At this moment in time there are some interesting long-term opportunities in the investment markets at a time when savings rates are minimal and many people are actually seeing the spending of their savings decrease due to the impact of inflation. So why are savers not investing their money?

The very fact that savers are willing to see their spending power reduce in the short to medium term is a damning indictment of the prospects for the UK economy in the short to medium term. The vast majority of people in the UK would prefer the security of having money in the bank, rather than investment markets, or property, even though there is minimal return and a reduction in spending power in the short to medium term.

Once savers in the UK begin to see more benefits from investing in the UK stock market and property market for example then we will see some movement in this area. However, as we have seen with the ongoing increase in the price of gold, the vast majority of investors around the world are happy to have their funds tied up in so-called "safe havens" as a hedge against potential economic difficulties in the short to medium term.