5 Types of Investment

Let’s examine five basic types of investments:

First up, savings accounts, include money market funds, treasury bills, and certificates of deposit. These are backed by the US government, and you can retrieve the money whenever you want. But they also offer such low interest rates that by the time you factor in inflation and taxes, you might even lose money!

Second, collectibles: include things like antiques, vintage toys, or rare comic books that you think will become valuable in the future. The trick to success is to spend a lot of time researching the products, market, and pricing.

Third, real estate: After a year, say its value goes up 3 percent, and the house is now valued at $103,000. If you put down a $20,000 down payment, that represents a 15 percent return on your investment!

Fourth bonds: A bond is actually an I Owe You. When you purchase a $100 bond from your city government, you’re actually lending that $100 with the expectation of being paid back with interest. It’s a guaranteed return, especially if offered by the government – but keep in mind that bonds can also come with a timeline for repayment of 15 to 30 years.