John, a diligent 30-year-old software engineer, finds himself at a pivotal juncture in his financial journey. He has diligently saved a substantial sum of money and is now contemplating the best way to invest it for his future. John's financial dilemma revolves around the choice between investing in shares and in bonds, and he is eager to seek guidance from his family and friends to navigate this complex decision. John's family and friends are a diverse group, each with their own perspective on investments. His father, a conservative investor, strongly advocates for bonds, emphasising their safety and predictable returns. In contrast, his childhood friend Sarah, a seasoned stock market enthusiast, encourages John to consider shares, citing the potential for higher returns, albeit with higher risk. As John weighs his options, he is plagued by concerns. He worries about the volatility of the stock market and the potential for losing his hard - earned money. On the other hand, he fears that investing solely in bonds may not yield the growth needed to secure his financial future. He also decided to talk to you as a financial advisor to get personalised advice. Task: Guide John on the pros and cons of investment in bonds and shares in this context. (15 Marks
John, a diligent 30-year-old software engineer, finds himself at a pivotal juncture in his financial journey. He has diligently saved a substantial sum of money and is now contemplating the best way to invest it for his future. John's financial dilemma revolves around the choice between investing in shares and in bonds, and he is eager to seek guidance from his family and friends to navigate this complex decision. John's family and friends are a diverse group, each with their own perspective on investments. His father, a conservative investor, strongly advocates for bonds, emphasising their safety and predictable returns. In contrast, his childhood friend Sarah, a seasoned stock market enthusiast, encourages John to consider shares, citing the potential for higher returns, albeit with higher risk. As John weighs his options, he is plagued by concerns. He worries about the volatility of the stock market and the potential for losing his hard - earned money. On the other hand, he fears that investing solely in bonds may not yield the growth needed to secure his financial future. He also decided to talk to you as a financial advisor to get personalised advice. Task: Guide John on the pros and cons of investment in bonds and shares in this context. (15 Marks
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