Martin Lewis has urged savers to consider investing in a diversified global tracker fund rather than relying solely on cash savings, warning that putting all money into a single share carries 'huge risk'. Speaking on his BBC podcast, the Money Saving Expert founder highlighted that the majority of queries about junior ISAs focus on cash rates, but for long-term goals, stocks and shares may offer better growth.
Lewis stressed that for money locked away for 10, 15, or 18 years, cash savings could be a 'disservice'. He pointed to historical data showing £1,000 invested in a global tracker fund over the past decade would have grown to £2,980, compared to just £1,270 in the best savings account—which failed to keep pace with inflation.
To mitigate risk, Lewis recommended spreading investments across 5,000 companies via a tracker fund that mirrors the global economy. 'Put it in one share and you could lose all your money. Put it in 5,000 different companies and you are spreading the risk,' he said. This advice was echoed by financial planner Ed Marshall, who suggested aiming for '5,000 plus different companies' to achieve diversification.
The tax advantages of ISAs were also highlighted: adults can contribute up to £20,000 per year, while junior ISAs allow up to £9,000 annually, with no HMRC charges on growth or interest. Lewis concluded that for long-term savers, taking a calculated risk through broad market exposure is often more beneficial than playing it safe with cash.
