The modern world is becoming increasingly more expensive to live in. The cost of living has risen, standard pay has seen no increase and the level of qualifications required to enter many fields has gone up. People can no longer retire at sixty and live off of a pension alone, and social security’s future is shaky and uncertain at best, non-existent at worst. Increasingly, elderly retirees are forced to seek part-time employment just to get by. It is therefore important to invest early so that by the time of your retirement you will have accrued enough savings to actually enjoy your retirement. You may need to get professional advice from a financial advisor like Frederick Baerenz or from a wealth management company like the one run by CEO Fred Baerenz to make sure you are not investing unwisely, but as an introduction here are three low-risk investments for those of you just beginning to dive into investing.
1. Invest in Money Market Funds
One type of low-risk investment is a money market fund. A money market fund is a kind of mutual fund that is regarded as a considerably low-risk investment. Money market funds invest in debt-based financial units; essentially when you invest in a money market fund, you receive a diversified selection of low-risk investments like short-term bonds that you can liquefy at any time by selling. There are many kinds of money market funds available to invest in.
2. Invest in Certain Corporate Bonds
Some corporate bonds are classified as low-risk and can be a good investment. These are issued by companies and come with both the risk of the company not honoring their agreement to make their payments (default risk) and the value of the bond fluctuating due to interest rate changes (interest risk). Corporate bonds need to be carefully vetted as they also differ in quality.
3. Invest in Certificates of Deposit
Certificates of deposit are issued by banks. Risk is non-existent unless you remove funds early.
There are many more types of investments than these three, so make sure to check them all out.