In today’s world, relying on a monthly paycheck from a nine to five job may no longer provide a path for financial freedom. This was proven by recent statistics which reveal that approximately 70% of surveyed Americans regret their financial decisions and wished they placed their savings on a well-performing investment that can yield better returns.
The good news is that with some research and proper planning, one can find safe investment vehicles that will set their families up for success both today and in the future. So here are three intelligent ways to invest family savings that will deliver peace of mind and may help deal with any unforeseen financial burdens in the future.
Real Estate Investments
Whether it’s for earning a steady flow of passive income or planning for retirement, the addition of a physical land or property to a portfolio can provide a higher return per unit of risk and lower the overall portfolio volatility. In fact, a recent survey shows how the US real estate market value rose steadily up to 4.1% in 2021. This happened despite the ongoing threat of COVID-19, along with other economic factors that have affected the most volatile and speculative investments.
The same survey has also revealed that individual real estate investors continue to dominate the US-based rental market with 74.4% properties owned by non-conglomerate folks. When done right, investing in real estate can become a full-time career that offers passive income and potential for long-term wealth that can be passed down to the younger generations.
Gold and Precious Metals
Widely known as the crisis commodity, gold and other precious metals have always been a time-honored part of a well-balanced portfolio as they provide competitive returns in comparison to other major financial investments in the market even during economic downturns. In fact, investors who buy gold can benefit from major price movements during macroeconomic and geopolitical uncertainties.
Looking at the historical prices of gold when the U.S. dollar fell against other currencies as it did between the years 1998 and 2008, its prices have soared and nearly tripled as they hit above the $2,000 mark. Similarly, research conducted by the Bank of England shows that fiat currencies tend to fall in value against gold during periods of high inflation or if there’s a crisis on the horizon.
Aside from acting as a safeguard against inflation when major currencies decline, gold is also considered a store of value that can preserve wealth and can be passed on from one generation to the next. This can be a good option for distributing family assets to children as the value of gold will still remain the same even after decades have passed.
With a reputation for stability and decent returns, investing in government bonds can be a fiscally responsible way to invest family savings. Government-issued bonds like ETFs and short-term CDs can be a fascinating market to consider in order to take advantage of its guaranteed rate of return and inflation component. Such funds that invest in government bond funds are considered to be among the safest investment and may work well for risk-averse investors since they are backed by the full faith and credit of the U.S. government.
As compared to stocks and cryptos, bonds tend to be less risky and are considered a safe haven for investors who look for an element of stability in their diversified portfolio for a more predictable stream of income in the long run. This low-risk and safe investment also comes with a certificate in hand which can be passed on to children or grandchildren to set them on the right financial path.
A good financial and investing practice can be a valuable part of building financial security in the future. Investing in real estate, precious metals, and government-issued bonds are some of the most prudent investment vehicles that set families up for a future of financial success.