Premium Bonds: Alternative savings options explored as inflation rises | Personal Finance | Finance

“Everyone should hold some cash to cover emergencies – we generally suggest around three months expenditure, but once you have that buffer in place thinking about investing is sensible. 

“While cash may appear risk free, it is steadily being eroded by inflation. Therefore, cash savings are not without their risk either!”

The expert also offered a series of tips to help those who are embarking upon this journey for the first time.

Firstly, he said, it is vital to keep costs as low as possible, given that the higher the fees the lower the likely return.

Next, Mr Norton added: “Choose funds that are aligned to your long-term objectives and then sit back and try to tune out market noise. 

“Clear goals can help you stay focused, especially when markets are temporarily in turmoil, but a solid plan and a low-cost, well-balanced portfolio can only achieve their potential if you stick with them.”