For most people that sacrifice and struggle to put aside saving in the hope of investing and making a profit, the risk of losing such savings is unfathomable. Such individuals would rather keep the money in a current account than risk losing it in unsure investments. However, fear of making a loss must not stop you from investing. There are numerous options for safe investments that you can invest money with a low risk of loss. Note that investing in secure investments means that your returns of investment are going to be minimal compared to higher risk investments. If you do not want to gamble with your hard-earned money, here is a list of secure investment opportunities.
Certificates of deposit – This is a loss-proof investment where you deposit money for a stipulated period and, in return, get a guaranteed return regardless of economic conditions during the period. The only way you can make losses with such an investment is if you choose to retrieve your money before the stipulated period.
Treasury issued securities – Treasury securities include treasury bonds, notes, inflation-protected securities, and bills. They are considered low-risk because the government that issues the bonds is unlikely to default and not pay its obligation to investors.
High-yield savings accounts – While this might not be considered as an investment opportunity, it does offer savers modest returns on money deposited. The reason that it is considered a secure investment is that it is government-insured; hence savers get compensated if the institution taking the savings fails.
Money market account – This is a mutual fund that is created for those that want to take part in secure investments by ensuring they do not lose their initially invested capital. Market fluctuations do not affect the principal invested, but the interest paid on the cash deposited is meager, so you are unlikely to make any serious returns on such an investment.
Annuities – With this kind of investment, the investor will give an insurance company your money to manage in the hope that they guarantee and deliver returns on investment. The returns on such an investment may be fixed or variable depending on the terms of the contract with the insurance company.
Saving bonds – This is more of a savings instrument as opposed to an investment vehicle with a negligible chance of losing money invested because the government backs it. Examples of savings bonds include I bond and EE bonds. Note the redemption of this bond before five years attracts a penalty.
Money market funds – These are pools of various low-risk investments that are grouped together to form a diverse investment portfolio. The fund managers are financial experts that actively manage the investment to guarantee investors some level of return. The good thing about this investment is that it is liquid; hence you can draw your money whenever.
Stocks – While purchasing stock is not as secure as cash and other savings accounts; they are generally low-risk investments. The various types of low-risk stocks include preferred shares, dividend-paying stocks, and growth stocks.
Corporate bonds – Similar to treasury bonds, these are issued by corporations that want to raise capital for investment. There is a higher risk level with this investment; therefore, if you are interested in corporate bonds be sure to identify corporations that are solid and have a proven track record of ensuring investors gain a return on their investment.
It is important to conclude by highlighting that secure investments might help you meet your savings goal or other short-term goals, but you will not be able to generate considerable wealth from such investments. To guarantee higher returns, invest in options that have a higher risk but make calculated investment moves to avoid making losses. For example, you could seek the services of an expert.