With the stock market in such a volatile state these days, it’s tempting to dig a hole in your backyard and bury your savings. This way you’d at least know where your money is at all times and how it’s performing for you.
Luckily, there are still some secure places you can invest your money and you won’t have to be afraid of your financial future.
Here’s a list of some places you should consider investing your money with very minimal risk:
1. Open money market / high interest savings accounts.
Money market accounts are great ways to invest money for the short-term. If you need a quick turnaround these are stable ways to secure a return on your investment. The current average yield ranges from 0.50% to high as 4.00%. The bank will reinvest your money into short-term securities with that solid interest rate as further incentive. These accounts are liquid and usually FDIC insured. The only drawback is that some money market accounts may require a minimum balance.
2. Treasuries are safe.
T-bills are issued by the U.S. government and are considered very low-risk investments. They are fully backed by the government. You can choose the maturity date when you’re investment will be fully realized. Short-term T-bills are the safest investments with maturity dates of 13 or 26 weeks.
3.Certificates of Deposit.
CDs are available through your bank or broker and are also very safe investments. They have set maturity dates and you’re locked into your interest rate at the time of your investment. If you withdraw your funds early then you incur a penalty that can be costly.
4. 401k Plans.
If your employer offers a 401k plan then you’d be wise to invest in it. This is your money that you put in on a pre-tax basis. Within your plan you can choose what funds you want to invest in. Whether you’re willing to assume risk or need stable funds you’ll find them in your overall plan.
5. Mutual funds.
There are many mutual funds that are tailored for those who have little appetite for risk. The mutual fund is monitored by a fund manager that invests your money in a number of stocks or other mutual funds. One drawback is that you need to pay administrative fees for the management of your fund.
6. Savings bonds.
These bonds will offer a low return but also are virtually risk-free, which is a nice thought in this financial climate.