Investing regularly in cheap UK shares can build up a surprisingly large nest egg. Over long time periods, the stock market has an impressive track record of delivering remarkable returns. And while a crash or correction occasionally rears its ugly head, like in 2022, these volatile periods always eventually end, paving the way for a spectacular recovery.
So much so that even someone who’s just turned 40 with no savings can potentially build a £1m ISA before retirement. Here’s how.
Capitalising on cheap UK shares
While unpleasant, last year’s stock market correction has created plenty of opportunities for shrewd investors. Although the FTSE 100 has largely recovered, the same can’t be said for the FTSE 250, which is still down 12% compared to a year ago.
With fear driving stock prices, plenty of businesses have seen their market caps slashed as investors flee the markets. And in some cases, this concern is justified. After all, rising interest rates have a tangible impact on companies, especially financially weak ones. But not every enterprise is doomed.
There are plenty of top-notch UK shares now trading at cheap valuations. Things may be a bit wobbly in the short term. But in the long run, many of these firms remain solid, with business models intact and demand still growing. And given sufficient time, performance will likely recover before reaching new heights.
