The Best Options for Secure Investments at Low Risk
Many people feel apprehensive when it comes to investments and rightly so, according to financial advisor Jeff Rose. All investments come with some amount of risk, but making a smart choice can reduce your risk.
Going with a low risk option does mean the return is likely to be lower, yet your investment will be more secure advises Rose. He provides his suggestions for the best low-risk investment options out there:
Certificates of deposit (CD)
Depositing your money with a financial institution for a specific amount of time will see you earn through a fixed interest rate on your deposit. You are guaranteed to get your deposit back and the government guarantees you will not lose more than you put in.
Money lent to your local government is exempt from income tax. The likelihood of your local government defaulting is very low which means your investment comes with very little risk.
There are two types of bonds: ones with a fixed interest rate and ones with an adjustable inflation rate return that is adjusted every six months.
Annuities can be very complex and involve paying out a lump sum of money in return of a guaranteed return. This could be fixed, variable or dependant on the stock market. Fixed is the safer option.
Achieving a return on your investment at low risk is achievable with the proper research.