Investment strategies differ depending on whether one desires to invest money for short-term benefits or wants to put money aside to generate wealth over a longer term. It is common to want to be more adventurous with small investments in a turnaround time that’s also short. For long-term investments, high profits are given lesser importance than the risk factor of the investments. One has many investment options for the short term. Treasury securities If one is looking for investing ideas that have an period of up to five years with a low risk of losing the principal amount, treasury securities are a very safe investment option. These securities are backed by the US Treasury, and there is a wide choice of securities like treasury bills, treasury notes, floating rate notes (FRNs), and treasury inflation-protected securities (TIPS). The treasury inflation-protected securities are a safe short-term option as they are based on the consumer price index (CPI) and are sensitive to inflation. One thing to keep in mind is that the principal amount will not be lost even if there is deflation instead of inflation. Bonds Bond funds are a good option for investors looking for investing ideas for a period of up to two years. These funds are riskier than others but are managed by professional portfolio managers and advisers and promise high yields. However, there are no guarantees of the principal amount invested. There are usually no penalties charged for premature fund withdrawal, but one has to be careful that they choose a brokerage firm whose fees are not too high. Municipal bonds Municipal bonds are riskier investing ideas than the other types of bonds. They are issued by a state or a local government agency and not by the Federal government. They have high yields, but there is an interest rate risk, which means the value of the bond goes down as the interest rate goes up. On the other hand, the principal amount and interest are guaranteed on maturity. Rewards checking account Rewards checking accounts are offered by some banks and offer cash back rewards for spending on debit cards linked to the account. This is one of the best investing ideas for a person who is reluctant to get into debt by using credit cards. They can use a debit card instead and still earn points on spending. While one may have a tendency to overspend on credit cards, a debit card with a rewards scheme will allow one to keep a firm hand on their expenditure. If one must access credit, an overdraft linked to the account can be availed for big purchases. Also, these cards usually have minimal or no fees. Money market accounts Money market accounts are FDIC-backed accounts that help people to both keep their investments safe and earn a higher rate of interest than one would earn using a savings account. These types of accounts usually require a minimum deposit amount, which might be an issue for those with limited funds. Money market mutual funds, on the other hand, are not FDIC insured, and it is important to know the difference.
