Of all the words in the English language, “investment” poses the most dilemmas for lexicographers.

Traditionally, investment was defined as “investing money for profit”. This evolved into “an asset or item acquired with the goal of generating income or appreciation”. Then it became “a thing that is worth buying because it may be profitable or useful in the future”.

Most modern dictionaries settle on “the action or process of putting money, time, effort into something in order to gain an advantage”. MMPI likes this definition best because it more accurately reflects our investment philosophy. In our opinion, investing is not about buying physical assets and twisting them for a subsequent financial windfall. Nor is it about punting on the stock-markets or delving into overseas property or hoarding gold. First and foremost, investment is putting time, effort and some money into a plan that will benefit you and your loved ones in the future.

In such a definition, the focus is taken away from the wheeling and dealing of money for a fast buck. Instead, the thrust focuses on time and effort spent now on making a plan for the future. Far too few of us have ever made such an investment.

Under this meaning, an investment is buying adequate insurance; making a will and keeping it updated; tidying up financial loose ends; checking your mortgage statements; arranging a medical check-up; getting more exercise. You get the drift. These are real investments.

Unfortunately, consumers don’t see the linkages – but, unforgivably, neither do legislators and regulators. All parties have an indefensible urge to place things in boxes. There are regulations covering banks, separate ones covering insurance companies, yet more for lenders, different ones again for stockbrokers and, most depressingly of all, none of the rules are interconnected. And yet, all of them impact on consumers in different ways.

For example, take one of the biggest financial transactions that most consumers every make – buying a new home. Mortgages are not viewed as an investment by regulators; so, investment regulations don’t apply. Life insurance, which lenders rightly make compulsory, is definitely not covered by investment regulations because life insurance products have a different set of rules. Lenders also insist on house insurance, in case of property damage, but this is covered by non-life insurance rules. Of course, the mortgage itself is subject to even more stand-alone regulation. Is it any wonder that consumers are overwhelmed?

Putting time and effort into your financial future is a very worthwhile investment. It does not require serious number crunching in all cases. It may simply be an expression of your willingness to re-examine your life cover – lower premiums may be available. It might see you paying off some of your mortgage at -5% with surplus funds sitting on deposit at 0%. It could prove advantageous to reconsider your pension contributions to maximise your entitlements.

Investing time and effort now and at judicious future dates is a real investment in your future. This is what MMPI does best!

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