When you are just starting out, investing can be intimidating. In times of unrest, you may look for safer investment opportunities. There are many lower-risk options available. Each investment comes with its own risks and rewards. Riskier investments can be more rewarding, but they may also come with higher returns. You might be aware that […]

When you are just starting out, investing can be intimidating. In times of unrest, you may look for safer investment opportunities. There are many lower-risk options available.

Each investment comes with its own risks and rewards. Riskier investments can be more rewarding, but they may also come with higher returns. You might be aware that higher returns can come from riskier investments.

Keep in mind, on the other hand, that investments with lower risks often yield lower returns. You can still make money from your investment.

Below, we’ll discuss some of the most common investment options.

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1. Savings accounts with high yield

These accounts have higher interest rates than the typical savings account. These accounts can be used to save money for the future or hold excess funds from your checking.

This could be an excellent option if, for example, you are looking to build up your emergency fund or start saving towards a home.


The flexibility of these accounts is quite high. Savings accounts may only allow you to withdraw your money six times a month.


You may be required to pay a deposit in order to open a bank account.

What is it?

These accounts offer greater flexibility in investing, provided you have FDIC coverage. Compounding interest allows you to withdraw money when needed, but potentially make a profit in the long run.

2. Cash Management Accounts

Cash management accounts (also known as sweep account) are offered by brokerage firms. They combine features of checking and savings accounts with the option to invest money.

Your money is protected by the FDIC if you have money that has not been invested in your account.

You can buy 3 shares at a price of $33 per share. Your cash account would be $1 with $99 spent.


You can move your money from a brokerage to an investment account easily. Many cash management accounts offer debit and check cards to make it easy for you to access your money.


These accounts are set up at a cost that is determined by the broker who holds your money. Fees can be charged for cash management accounts.

This will vary depending on your provider and the amount of cash that you can manage.

What is it?

FDIC insurance may apply depending on the amount of money you have deposited and where it is. You may have the option to withdraw money quickly depending on how your account is set up.

3. Certificate of Deposit (CD)

Certificates of Deposit (CD) are a set amount you deposit into savings over a certain period of time. Banks will give you interest if they can use the money in another way during this time.

This type of investment allows you to choose a time frame for your investment. The interest rate is usually determined by market conditions, such as Federal Reserve’s federal funds rates.


It is not usually beneficial to withdraw money earlier than you expect. Your bank may charge you differently depending on its guidelines.


There is no cost associated with the opening of a CD.

You can renew most CDs automatically unless the credit union or bank tells you not to. Check with your bank if you wish to spend your money on something else before the contract expires.

What is it?

A CD purchased from an FDIC insured bank can have up to $250,000 of insurance. This insurance covers your entire account at that bank. If your balances total more than $250,000. you might want to move some money to another institution.

4. Treasury Securities

Treasury Securities are obligations issued by Treasury in the forms of Treasury notes, Treasury bonds and Treasury bills. The income is exempted from federal and state taxes, but not local.


The type of Treasury marketable securities determines the flexibility.

  • Treasury bills:Term options range from four to 52 weeks. They can be purchased at face value, or discounted. However, you will receive the face value of your purchase when it matures.
  • Treasury notes:These note mature over two, three five, seven, or ten years. Interest is paid each six months.
  • Treasury bonds:These are available in terms of 20 and 30 years and pay interest each six months.


You can buy these Treasury Securities in denominations between $100 and $10,000, or in $100 increments.

What is it?

Treasury Marketable Securities can be purchased through your TreasuryDirect account, or through an independent broker.

Remember that TreasuryDirect can only be used to make non-competitive offers, while brokers are available for both competitive and non-competitive offers.

5. Money market funds

Money Market Funds are mutual funds that can be purchased by both consumers and investors. These funds, which are not to be mistaken with money-market accounts, are not FDIC insured.


These investments can be cashed out, but there are usually fees associated with it. It may be necessary to pay liquidation charges and to wait a certain period of time before receiving your profits.


Most money market funds do not require large initial investments. They’re low-risk, but they aren’t the best choice if you’re looking for greater returns.

What is it?

Money market funds, also known as short-term investment accounts or money market securities, are safe investments for your money. They store it in CDs and Treasury Securities. These funds can be thought of as an additional way to diversify a low-risk investment portfolio.

6. Stocks of preferred stock

The name of the preferred stock is exactly what it implies. You get some preferential benefits over owners of ordinary shares.

For instance, you may:

  • Dividends paid before the common shareholders
  • Priority is given to preferred stockholders in the event of bankruptcy and liquidation.
  • Priority investment in funding rounds
  • You can vote or approve major company transactions or directors.


If you want to sell preferred stocks, you can do so in a similar way as you would if you were selling common shares. However, you might face price changes since the time you bought your stock.

They are like bonds in that they provide an income at a set rate. Certain preferred stocks come with conversion options. A company can either buy back your preferred stock or convert it to common stock.

Before you purchase any preferred stocks, make sure to review the fine print and consult with a financial advisor if needed.


Remember that preferred stocks will cost you more than common shares for the same firm.

You will also likely be charged transaction fees if you sell or buy stocks.

7. Annuities fixes

An annuity contract is a form of insurance that provides a guaranteed income for a certain period. Annuities come in many different types and can be priced and structured differently.

There are many types of annuities. The most common is the fixed annuity. These are funds that you invest in over time and receive a regular income, whether it’s for a set period of years or indefinitely (e.g. the rest of your life).


Every annuity is different. Before purchasing, it’s best to review and discuss the contract with an expert.

There are different types of annuities and some are better suited to certain individuals. There are also immediate annuities that allow for a quick payment in exchange of a lump sum.

You may be charged a substantial amount of money if you withdraw funds within a specified time frame after opening your account. They usually last six to eight years, but can extend as long as 10 years.


Remember that you will be charged a variety of charges, in addition to tax and interest.


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Consider other investments

8. Dividend Stocks

Dividends refer to payments made by companies from their profits. Stock dividends are a good investment for those who want to take on some risk, but still have a stable and predictable investment.

Dividend-paying stock is a popular choice for investors who want a stable income. Stock prices do not necessarily have to rise in order to earn money.

9. Stable value fund (SVF)

People who want to accumulate wealth slowly may find that stable value funds are a low-risk option. Investors can get a stable return without the risk of high-risk investments by investing in Stable Value Funds.

The funds consist of a mixture of fixed income investments and bonds. They offer higher returns than money-market funds, without experiencing the volatility of stocks.

These funds are ideal for those who want to accumulate wealth over time without taking significant risks. These funds are often backed by contractual guarantees that protect investors against potential losses.

10. The Series I Bonds

The Series I bond protects your buying power and allows you to keep your money safe from inflation. Your principal and interest is guaranteed because they are backed up by the United States Government. The rates of Series I bonds are adjusted twice annually to reflect inflation.

Interest rates are composed of a fixed index and an index based on a variable rate. The variable rate depends on the 12-month average CPI-U.

You can buy Series I Bonds for $25 and redeem them electronically after 12 months. However, you’ll lose the interest on the final three months if redeeming the bonds before five years.

Paper Series I Bonds have a minimum price of $50.