Smart Ways To Invest Money Outside Of Stocks

Smart ways to invest money will pay off in the long run, regardless of economic, social and political conditions.

The harsh truth of the matter is that there is no such thing as a perfectly safe investment. All investments involve some type of risk, and there is always a chance that something will adversely affect the value of even the most solid investments. Furthermore, investment options are interlinked. Problems with one type of investment can adversely affect the value of another. However, some investments are definitely more stable than others, which makes them preferable to alternatives. Investors should also remember that putting their money in more then one type of investment will increase the chances that they will be able to get their money's worth one way or the other.

Gold and Other Precious Metals

Unlike many other types of investments, gold has intrinsic value. In other words, it has innate value that is not dependant on economic conditions. It remained valuable during the Great Depression and other, lesser known economic crises. The value of gold is prone to fluctuations which can be caused by all sorts of factors, but even in the worst times, it remains valuable enough to make it worth the investors' time. Investors should take comfort in the fact that the value of gold tend to rise when other investments lose value. The same is true (though to the lesser extent) for other precious metals.

Treasury Bills

Treasury bills are securities that are issued by United States treasury. They are sold in terms ranging from a few days to a year. Their value is determined at weekly or monthly auctions (the time depends on the overall length). While they don't gain as much value as some of the other investments, they are fully backed by US government.

Certificates of Deposit

Certificates of deposit are time deposits made at banks thrift institutions and credit union. The investors deposit the money for a specific period of time and withdraw the deposit once it's over. The resulting sum is larger because of the interest that it accumulated. The interest rates are usually higher then they would be in ordinary accounts. The interest rates are locked in, which ensures that they will increase at a consistent rate regardless of the economic climate. Investors should keep in mind that if they withdraw their money before the agreed upon date, they will have to pay a large fee that would undercut whatever gain them would have otherwise benefited from.

Municipal Bonds

Municipal bonds are bonds issued by city and state governments, either directly or though one of their agencies. They are used to raise funds, often for specific projects. Investors can earn money by waiting for it to collect interest. Some municipal bonds work like certificate of deposit, while others are more long-term. In the later case, the accumulated interest gets deposited in the investors' accounts on annual bases. They are less secure than some of the others on the list, but they are still fairly secure compared to stocks.

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