In a world where financial choices can set the trajectory for your life, changes are happening right now that you need to be aware of. While the stock market often takes center stage, it’s important to remember that it’s not the only game in town.
Today, we’re stepping back to examine some alternative avenues that can yield great returns without causing you sleepless nights.
Why Bonds are Buzzing
One interesting asset class these days is the bond market. Bonds are ways for companies, countries, and other entities to borrow money from you. When you buy a bond, you’re lending money to that entity. Some of the assets that are considered the lowest-risk are American treasury bills. It would also be government bonds from other countries – like Denmark, where I’m from—as long as you expect the country’s GDP to grow in the future. Avoid bonds from risky parts of the world.
One of the key factors making bonds more appealing right now is the rising interest rates. If you have a loan – house loan, credit or other loan you’ve likely noticed this.
The interest rate is approaching 5% and even higher in some countries. As an investor, you want your assets to outpace inflation, which has historically averaged around 3%. You also want your assets to be as free from risk as possible.
Alternatives to Consider
So, if you can get a high yield savings account of 5% or more that could be an avenue to explore. That’s super low risk and it’s 2% above inflation, so it’s worth our while to consider. A further increase would be even more interesting. High-yield savings accounts provide a stable return.
As mentioned in the article about there are currently 3 avenues you can take to maximize your return and minimize risk. In today’s ever-changing financial landscape, it’s crucial to know your options.
A government bond, high yield savings account or the stock market are all valid paths for anyone wanting to invest with minimal risk. Remember, it’s all about balancing risk and reward.
To learn how to be a smart investor, sign up for my investing workshop. Here I will teach you to look for opportunities like this to maximize your return while not risking losing your heard earned money.
Photo from The Investor’s Podcast networking event this weekend – thank you Stig Brodersen for hosting the event and for the generous gift – a signed copy of William Green‘s book “Richer, Wiser, Happier” (I must admit it’s my third copy of the book – though this is the first one signed by the author). As readers on the blog know, I’m a avid reader and I gave a Stig a book too – Walter Isaacson’s “Elon Musk” (not signed though 😉