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Points Trustees Must Consider When Investing

  1. The first step is to decide what the charity’s investment objectives are.  There could be a specific goal that you are aiming for or you may be required to use income only to funds projects or causes. 
  2. The timescale of the charity’s objectives is important in deciding what type of investments will be appropriate.  Short term funds ought to be kept in very low risk, deposit type accounts.  Funds to be invested for the longer term could be invested in assets that have better prospects for growth and income than deposit accounts, however these are likely to fluctuate in value in the shorter term, hence the reason they should be viewed as long term holdings.  For example, shares or commercial property investments.
  3. There should be a balance of investments to ensure that you are not taking too much risk with the funds.  The phrase ‘ don’t put all your eggs in one basket’ is key when considering investment strategies, and the word ‘diversification’ is used in the Trustee Act 2000.
  4. Administration – how do the investments fit in with the way charities are administered and taxed.
  5. Regular Reviews.  We cannot stress enough how important it is to review the investments regularly.  It is a requirement of the Trustee Act 2000 and for good reason.  It will allow you to ensure that the investments remain suitable, make changes if the requirements have changed and deal with any problems that may have arisen.

One area of many areas of specialism of the Furley Financial team is, trustee investments. We assist many trusts and charities with making appropriate investment decisions. 

We would be happy to provide an initial consultation, free of charge, to establish how we can help with your charity’s investments, whether new or existing.

 For further information contact Ruth Dolan, Chartered Financial Planner, on 01227 763939.


 

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