Why I’d stop saving and start investing in UK shares to make a passive income

first_img I’m sure you’ll agree that’s quite the statement from Motley Fool Co-Founder Tom Gardner.But since our US analyst team first recommended shares in this unique tech stock back in 2016, the value has soared.What’s more, we firmly believe there’s still plenty of upside in its future. In fact, even throughout the current coronavirus crisis, its performance has been beating Wall St expectations.And right now, we’re giving you a chance to discover exactly what has got our analysts all fired up about this niche industry phenomenon, in our FREE special report, A Top US Share From The Motley Fool. Peter Stephens | Friday, 2nd October, 2020 Image source: Getty Images Why I’d stop saving and start investing in UK shares to make a passive income Renowned stock-picker Mark Rogers and his analyst team at The Motley Fool UK have named 6 shares that they believe UK investors should consider buying NOW.So if you’re looking for more stock ideas to try and best position your portfolio today, then it might be a good day for you. Because we’re offering a full 33% off your first year of membership to our flagship share-tipping service, backed by our ‘no quibbles’ 30-day subscription fee refund guarantee. Enter Your Email Address Click here to claim your copy now — and we’ll tell you the name of this Top US Share… free of charge! I would like to receive emails from you about product information and offers from The Fool and its business partners. Each of these emails will provide a link to unsubscribe from future emails. More information about how The Fool collects, stores, and handles personal data is available in its Privacy Statement. “This Stock Could Be Like Buying Amazon in 1997” Simply click below to discover how you can take advantage of this. The recent volatility among many UK shares could cause some investors to sell them and hold cash in search of a passive income. However, the returns available on cash could prove to be very disappointing over the long run. Moreover, low stock prices may mean the yields available on British stocks are very attractive.As such, now could be the right time to stop saving and start investing in a diverse range of dividend shares.5G is here – and shares of this ‘sleeping giant’ could be a great way for you to potentially profit!According to one leading industry firm, the 5G boom could create a global industry worth US$12.3 TRILLION out of thin air…And if you click here we’ll show you something that could be key to unlocking 5G’s full potential…Making a passive income from cash savingsFalling interest rates mean many savings accounts currently offer scant opportunity to make a worthwhile passive income. In fact, obtaining an interest rate significantly above 1% on easy access savings is very challenging. As such, savers will need to have a vast sum of capital available to make even a modest income return from their cash savings.Looking ahead, things could get even worse for savers. There’s continued talk among policymakers about the prospect of negative interest rates. While banks may never end up charging customers to hold cash savings, the prospect of improving returns on cash balances seems to be low.This could mean that your spending power is eroded over the long run. Especially if inflation increases due to the amount of monetary policy stimulus being used to combat a period of weak economic growth.Dividend opportunities among UK sharesOf course, making a passive income from UK shares has been challenging this year. Many FTSE 100 and FTSE 250 companies have decided to cut their dividends in response to uncertain operating conditions.However, it’s still possible to build a diverse portfolio of income shares that offer high yields in many cases. The stock market crash has caused many UK shares to trade at low prices due to the risks they face. This means that, in some cases, their yields have risen to exceptionally high levels. Compared to other assets, such as cash, they offer returns that are many times higher.Furthermore, dividend growth prospects could mean that making a passive income becomes easier for investors in British stocks. The past performance of the economy shows it’s likely to recover from its present challenges to post positive growth. This may allow investors in dividend stocks to enjoy an inflation-beating rise in their incomes over the coming years.Risk reductionUsing UK shares to make a passive income is clearly riskier than holding cash. However, those risks can be reduced by holding a diverse range of companies in your portfolio. Although they are likely to experience uncertain trading conditions for many months, their potential income returns appear to be significantly more attractive than holding cash.Therefore, buying stocks could prove to be a sound move over the long run for income-seeking investors. Our 6 ‘Best Buys Now’ Shares See all posts by Peter Stephenslast_img

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