Ed has never saved before as he hasn’t been able to afford to. Now he’s working, he has some spare money. His parents have always saved in Cash ISAs and have some investments. He wants to get into the habit of saving regularly.
Ed hasn't got anything particular in mind for his savings and simply wants to save monthly to build a pot of money over time for his future.
He has been doing some research and he knows that if he saves a regular amount, the money he puts in will grow over time, however inflation may reduce the real value of his savings. His parents have said that the returns he could get from investing are potentially better than traditional savings accounts.
Ed is aware that due to the level of his savings at the moment any income received will be free of income tax due to the Personal Savings Allowance. His parents have told him there are also tax efficiencies with an ISA though the favourable tax treatment of ISAs could change in the future. He also knows that each tax year there are limits to how much he can pay in.
Ed is considering opening a savings account and will make regular payments into it each month. He may consider investing a regular amount in the future, once he has built up some savings.
If he needs to he knows he can change or stop his monthly payments at any point.
Ed is an illustrative character designed to highlight why and how people approach investing. His financial situation, objective, knowledge and approach are fictional and you should always consider your own before investing.