Here you can compare the projected returns you might get if you take different levels of risk with your investment. The amount of risk changes a lot depending on when you need your money back, so it's good to play around with different possibilities.
We can't offer advice, but these are the key things to consider:
Here are a couple of other useful links:
When considering how much risk to take with your investment, it's important to think through how you might be affected by various possible outcomes for your investment. To help with this, below are some fictional case studies of people for whom investing did and didn't work out.
Good outcome - Sally transferred half the money from her savings account into a very high risk/return ISA
She left half her money in cash savings to fall back on if she needed them. She usually had a few hundred pounds left over at the end of each month which she also split 50:50 between the cash savings and the very high risk/return ISA.
She didn't have any particular goals in mind for the ISA, but she knew she didn't need the money for anything else and felt it was better than leaving it all sitting in a savings account.
She got a bit of a shock when, just a few days after she invested, she got an email alert from CushonMe telling her that her investment had fallen in value by 10%. She had invested £10,000 so this was a loss of £1,000.
It was a worrying time, but she didn't need the money right then and still had the other half of her money in cash savings, so she decided to stick with her investment.
The market continued to be turbulent and at one point she had lost nearly £1,500. But eventually it started to recover and Sally was able to stop worrying about her investment.
15 years later, the market had recovered strongly and her investment compared very well to the other half of her savings which she left in cash:
This left her feeling pretty smart about leaving her money invested.
Very bad outcome - Charles invested all of his spare earnings in a very high risk/return ISA
He was married to Claire who was taking a career break to look after their two children. They had just bought a house, and interest rates were very low so they took out a big mortgage and were making the smallest repayments they could.
Charles invested all of his spare earnings which amounted to some £1000 a month. His investments performed pretty well and after a couple of years they were worth £30,000. But then the economy went into recession and this had some unfortunate consequences for Charles, Claire and their children:
Charles and Claire had to cash in their investment to cover the repayments on the mortgage, then eventually sold their house at a loss. Charles did eventually get another job, but he, Claire and the children had to live in rented accommodation until they had managed to save enough for another deposit.
Good outcome - Dave and Jenny invested in a high risk/return Junior ISA for their new baby
They were thinking ahead to the possibility of university, but that was 18 years away so they figured it didn't matter if their investment went up and down in the short term.
They set up a direct debit for £100 a month and then left the investment to look after itself. They knew that if anything really drastic happened then CushonMe would send them an alert so they pretty much forgot about it.
There were a few worrying times, and one year the market crashed and their investment fell in value by nearly £4,000. But they kept up their direct debit and the market eventually recovered.
By the time their child turned 18 the Junior ISA was worth £50,000 which was a real help with the university fees.
Bad outcome - Jim invested his inheritance in a low risk/return ISA to save for his next car
His current car was running fine, so he thought it would be at least 3 years before he needed to replace it. Even if the market crashed, he though that should be enough time for it to recover if he chose a low risk/return investment. He had inherited £10,000 and put it all into the ISA.
Everything was fine for a couple of years and his investment grew steadily. But then one day he got an email alert from CushonMe telling him his investment had fallen in value by £300 over the previous 6 months.
He wasn't too worried as his car still seemed fine so he decided to wait for the market to recover, but over the following 6 months his investment lost another £300.
Then his car broke down. At this point, his investment was only worth £9,400 so he to cash it in at a loss of £600. He was pretty upset as this meant he couldn't afford the car he wanted.