Investors considered rising inflation and low interest rates to be more of a threat to their wealth than Brexit, research from Rathbones Investment Management has found.
More than two-fifths (42%) of investors viewed rising inflation as a major threat to their wealth, while the same number cited consistently low interest rates as a key concern. Less than third (30%), in comparison, saw Brexit as one of the biggest obstacles to building and maintaining wealth.
In fact, more than two-thirds (69%) of investors said they did not consider Brexit as a substantial threat to their finances. Rathbones said this suggested most investors were confident they had taken, or could take, the necessary steps to mitigate any future economic uncertainty.
In contrast, it said mounting inflation raised concern for many investors, particularly those with a substantial amount of wealth in cash. UK inflation held steady at 3% in October, it was reported today by the Office of National Statistics. It reached the five-year peak in September.
Rathbones surveyed more than 1,000 UK savers and 500 high net- worth individuals in August.
Around a quarter (26%) of investors said they had already been negatively affected by the rising rate of inflation. Another fifth (21%) said they were concerned it would impact them in the near future.
Conversely, just one in 10 (10%) believed their finances had been positively impacted by the rise in inflation.
Nearly a fifth (17%) of surveyed investors, meanwhile, said they felt more positive about their finances than the previous year, yet a similar number (18%) felt less confident than a year ago.
Rathbones investment director Robert Szechenyi said: "In this climate of heightened uncertainty, it is encouraging to see investors appreciate there need not be a ‘bad' Brexit scenario as far as their investments are concerned.
"So long as investors are vigilant, prepared to adapt and make sure their investment portfolio is diversified, they should be able to make positive investment choices which mitigate both the risks of Brexit and inflation.
"The fact that close to a fifth of the investors we surveyed felt more positive about their financial situation than last year is also encouraging and shows that, despite some adverse conditions, shrewd investment strategies have the potential to reap rewards."
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