While most people are wary of the risks involved with investing, there are some types of investments that can be considered safe. For example, fixed indexed annuities offer fixed rates of return, and are not affected by changes in the stock market. In contrast, variable annuities are less safe and expose investors to fluctuations in the stock market.
Although safe investments have lower yields than other types of investments, they can be an excellent way to lock in your money. They are also popular for retirement portfolios. However, you have to keep in mind that you will not be earning any interest on these investments if the inflation rate climbs too high by 2022.
If you are a beginner investor, it may be tempting to invest only in safe investments. This way, you don’t have to put too much of your money into risky investments, which can cause your portfolio to lose value faster. Besides, a safe investment will earn you a steady income over time.
Another type of safe investment is a bond. Municipal and corporate bonds can offer high returns and are popular investments for conservative investors. These bonds are issued by corporations to raise capital for different projects. These bonds are backed by the corporation, which means they pay interest until maturity.