There are risks each of us takes in our everyday life. We leave our homes every morning expecting things to happen as they normally do, same as yesterday and as the day before, but there is no true way to lead a life free of risk. However, there are many things you can do to protect yourself in order to lower the risk factor and in the money world, there are many lower-risk options out there that can help you to better save up and keep your money for your future.
Investing without all the Stress
One of the main reasons people fail when it comes time to invest is because they toss all of their money into one single basket (better known as, a company). By placing all of your faith in a single business, you are taking a major risk. What would happen if the company were to go bankrupt tomorrow? All of that money could potentially be gone. This is why it’s so important, even if particular companies look promising, to be cautious; it’s not that you are expecting the worse by any means but you are taking charge of your money and keeping it protected. We cannot stress enough how important diversifying your investments (especially when pertaining to the stock market) can be.
Low Risk Certificates of Deposit (CDs)
Also known as ‘no-risk’ or ‘no-penalty’ CDs, these certificates of deposit are unique as they are not as strict as other CDs. Whereas conventional certificates will penalize you greatly for taking out early withdrawals, risk-free CDs do not do so. This means if something ever is to come up and you wish to remove some or all of your cash, you won’t have to feel as though you cannot do so.
Tracking Your Money is Important
While many people know it’s important to track how much money they have in the bank; too many do not continually do so. They are hit with late fees without noticing here and there or overcharged for the tip they gave their last waiter.
Seemingly ‘small’ occurrences such as these add up over time. For example, is your bank FDIC insured? Many of you are probably gasping on the other side of the screen wondering if your bank is, in fact, covered. The good news is this is something you can easily find out. If you find your bank included in that list, then your savings accounts are probably FDIC insured up to $100,000 per account.
Research US Savings Bonds
The reason so many investors reach for saving bonds is because they are protected by the FDIC, so just like no-penalty CDs, they are extremely low risk. They may not earn as much interest as say, the stock market, but bonds are still a great way to save money while also increasing your cash flow.
Learning to Release What is Out of Your Control
At the end of the day, one thing to remember is that you can only do so much. Even if you take every precaution there is, nothing in life is 100% guaranteed. However, by taking your time to invest smartly, you are giving yourself the best chance there is. Sometimes when looking at the state of the economy or what is going on legally with popular banks, you may feel the need to hold your money tighter; all you can do is hope for the best and plan to the best of your ability. Maybe this means switching banks or spreading your money out among various banks. Hiding money under your bed may sound safer than trusting the banks or the government but there are other dangers associated with that. There are dangers in life no matter what route you choose to take so make sure you choose what you feel is best for you and your family because that’s what matters the most.
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George Smith-Davies works in the finance sector and says that if you want your money to be safely invested then you must find out more about the plan you want to invest in.