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These red flags are signs that you are over-saving

Fidelity UK

24,621 views

Saving money is an important financial habit, but at some point you might find you’re saving too much, and not investing enough. In out latest Personal Investor podcast, Ed and Marianna highlight the signs that you are over-saving and what you can do about it.

Capital at risk. This is not a personal recommendation.
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0:00 - Intro
1:03 - What is ‘over-saving’?
2:11 - Emergency funds: why can they be too big?
3:44 - Paying off mortgages too quickly
5:50 - Addressing the fear of losing money
7:58 - The value of automating your savings
9:39 - Continuing to grow cash savings when it’s not needed
11:28 - Guaranteed income considerations
13:38 - How to stop ‘over-saving’
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20 Comments

@fredcat9080 3 months ago

As I move into my mid 50’s I am becoming increasingly aware of how difficult it will be to get another job at my current salary. Therefore I’m increasing my emergency fund up to 9-12 months of outgoings.

@lawrysimm 4 months ago (edited)

The psychological benefit of paying off the mortgage was enormous. And it’s GUARANTEED no debt versus POSSIBLE investment returns. I just hammered it down 7 years early. Massive weight off the mind and now I just pile into investments. Happy with my choice. Yes I could possibly have got a couple of percent elsewhere but guess what? I have no mortgage. That’s massive.

@jaybe999 4 months ago

Obviously investing is a good idea ‘long term’, but when you’re 60+, the safety of a cash ISA is important too.

@ryanf6530 4 months ago

I think it's great that you're making these videos. The majority of Brits have very limited understanding of investments and as a result too many of us struggle in retirement. Hope this video gets more people into it.

@andrewholt5659 4 months ago

Mortgage overpayments are risk and tax free returns. Paying off my mortgage was best thing I ever did. Now I can plow money into index funds with no worries.

@DB25k 4 months ago

another great video with ed and Marianna on good to know topic on over saving, keep up these very important video for financial knowledge everyone should be aware.

@madmcadder4536 4 months ago

Good advice.

@Andygb78 4 months ago

Hopefully there'll be plenty of goals in the World Cup next month.

@bristolview56 4 months ago

It certainly pays to pay off your mortgage asap. If you're older/retired holding more cash is a good idea; in the video they say retirement can last 30-40 years but it's more like 10-20 for most people. You have to remember companies like Fidelity make their money from people buying and selling shares/funds so their advice is going to be biased towards those options!

@DrDoom49 12 days ago

It’s kinda simple. If your mortgage interest is lower than your avg returns on a index fund then it’s better to invest

@69spook 4 months ago

What a nice man!

@Sileesosij 4 months ago

Probably, could be, may be, should be, wishywashy…although you add the caveat you’ve all but said past performance is a good guide to the future.

@derpat65 4 months ago

On mortgage overpayment v investing the money instead then don’t forget if you put the money into a pension then you are getting min 20% TAX RELIEF v mortgage rate of say 6%, so quite a positive difference from outset. Of course freeing yourself of your mortgage is an emotional pull (heart not head). On an entirely separate point I think Marianna should do audio books. Love her raspy voice.

@carguyuk7525 4 months ago

Always overpay your mortgage. Reduce debt. Over time you can accelerate your rate of paying back. Only max out your pension, with your employer paying their maximum.

@user-te7zz8mv3x 4 months ago

i have a standing order to save regularly to pay for lumpy monthly variable costs!

June is usually my most expensive month because my car servicing, road tax, car insurance and home insurance all land at the same time :(

@colincottell4981 4 months ago

There is no consensus about the size of a emergency fund. I’ve heard from three moths to four years.

@colinbryer8022 4 months ago

Anything Marianna says is alright for me.

@richardsutcliffe98 4 months ago

we know the market is topping when institutions start suggesting cash should be in equities. their pissed off buffet doesn’t agree

@SteveParker-h4k 4 months ago

I like listening to Marianna great explanations but i would go further to say hold 6 months cash for emergencies or stuff you just didnt plan for and 6 months if markets do fall during deacumulation.. So no values discussed, saying 6 months is ok but you need a monatory value ..

@RSSZ87 3 months ago

I think the worst offenders, based on people that I know, are retirees with that sweet defined benefit/final salary pension deal. I know so many of them who have been blessed with the best years of economic prosperity, and are simply sat on piles of cash, uninvested, because they know their lifestyle is protected by the cheque that comes every month. If they had a degree of financial literacy, they could be investing their surplus, and they all have it, wisely, to protect their children, who haven't been quite so blessed.