Armchair investors cash in investments to cope with cost-of-living pressures

Nearly half of armchair investors have cashed in their investments to keep pace with the soaring cost of living, new research suggests.

A survey of 2,000 UK shareholders by Equiniti (EQ) shows that 44 per cent of investors have sold stocks as they “need the cash” to cope with bigger household bills.

Men (46 per cent) were slightly more likely than women (41 per cent) to take this course of action, and mainly those aged 18 to 40 (56 per cent), while older investors (aged 41-75) were less likely to sell.

The research also shows that about a third (34 per cent) of investors have switched out of so-called ethical stocks over the last 12 months in a bid to achieve better returns as a result of the cost-of-living crisis.

Investors are said to need the cash to cope with soaring household bills. Picture: Jon Savage

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Thera Prins, chief executive, UK shareholder services at EQ, said: “Investors typically look to invest with a long-term horizon to build wealth but the current economic environment means a lot of people are being forced to rip-up their plans.

Inflation is at a 40-year high, which is putting immense pressure on household finances, therefore it’s no surprise that many people are looking to make up the shortfall by selling out of their investments.

“There is nothing wrong with that, but it’s important that investors who dip into their pots to cover bills think of how they are going to replace those funds when that financial pressure subsides.

“Looking at it from a listed company perspective, the worry now will be convincing shareholders not to divest any further, demonstrating their long-term value over providing a quick buck.”

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