With the credit crunch biting, the economy wobbling and the stock market teetering on the brink of a nervous breakdown, you don’t need to be an expert to see that 2008 is not shaping up to be a vintage year for investors.

Profits could prove as elusive as those notorious Revenue & Customs data CDs. Even the previously indefatigable property market has wearied itself after more than ten years of unchecked growth. But as Warren Buffett, the billionaire investor, once said: “Predicting rain doesn’t count; building arks does.” So what can be done to shelter from the storm clouds gathering ominously on the investment horizon?

In times of uncertainty, cautious investors could always do worse than hold cash, although returns are likely to diminish, with the Bank of England almost certain to cut interest rates a couple of times next year. Another problem is getting the timing right. Moving in and out of the stock market is a bit like roulette, only less fun.

Investors with a more liberal relationship to risk may wish to consider the advice of our investment experts, who suggest diversifying into select overseas markets such as Europe and Russia. But even these markets will face testing times, particularly if America, the engine of the world economy, falls into recession, as many economists predict. To avoid any nasty surprises, prudent investors should drip-feed their money into such markets rather than invest lump sums.

While the outlook for equities looks uncertain, the prospects for property, both commercial and residential, look worse. You know that things are bad when even estate agents, the perennial trumpet blowers for the industry, are predicting static growth. Having said that, the gloom should not be overdone. Lower interest rates next year should help to support prices and, as long as employment holds up, it is unlikely that there will be enough forced sellers to trigger a real slump. A more likely scenario is that prices will drift lower over the next couple of years.

With few assets classes offering much promise over the next 12 months, investors must take comfort in the knowledge that investment is a long-term game.

There may be dark financial clouds hanging over 2008 but an unexpected volte-face by the Government means that there are at least 130,000 people who can now look to the new year with renewed optimism. Finally, after five long years of intransigence, ministers are offering a decent compensation package to the workers who lost their company pensions when their employers went bust. The money will allow the workers, some of whom lost 30 years of savings, to receive 90 per cent of the benefits they were due.

While it would be churlish not to welcome the righting of this wrong, we should not fall over ourselves to congratulate the Government. To start with, ministers should have stepped in much sooner. Allowing this injustice to fester has done incalculable damage to the reputation of pensions. The Government also employed despicable tactics to justify its refusal to help. At one stage ministers claimed that a rescue package would cost £15 billion of public money – the actual figure is £2.9 billion over 60 years. It even had the temerity to ignore the advice of the Parliamentary Ombudsman after she concluded that ministers bore some responsibility and should pay compensation.

Now that the Government is in a more contrite mood, there is another relatively inexpensive step it should take to restore public faith in saving for retirement. Ministers should guarantee that anyone who joins the new national pension savings scheme, due to start in 2012, will be better off in retirement than if they do not save anything and instead rely on means-tested benefits.

Although only a very small number of people could be worse off if they join – namely workers in their late fifties with no savings – even the hint that this could be the case is likely to deter many others.

Ministers worried about writing a blank cheque to underwrite investment performance would be better advised to worry about millions of workers refusing to join the scheme and the cost to the State of providing for these people in their old age.

This Christmas most people will have received a present that they could probably have managed without. For me it was a book, Teach Yourself Latin. It will prove useful, no doubt, should I ever have a couple of spare years to fill. Until such a time, however, I am unlikely to use it a great deal.

Still, I should consider myself lucky. A couple of years ago a friend of mine unwrapped his Christmas gift to find three dozen bin liners. Confused, he looked to his wife, who explained that she had also hired a skip and that it was time to clear out the loft.

So what to do with those unwanted presents? You could try to take them back to the shop from which they were bought, but you will be relying on the goodwill of the retailer – stores are only obliged to refund goods that are faulty or not as described.

If you can’t get a refund, you could always try eBay, which has helpfully made today a 10p listing day. Alternatively, wait until next year and give the present to someone else, taking great care to remember who gave it to you in the first place.