Investors whose savings and investments have been battered by the machinations of the stock market may want to take a step back and reevaluate their portfolios.
Tilting less toward high risk stocks and mutual funds and more toward safe fixed income investments like government securities can be a good move in a difficult market.
In fact the recent turmoil in the stock market has caused many investors to take a second look at good old fashioned savings bonds.
While they may lack the flair of credit default swaps and sub prime mortgage backed securities they make up for that lack of excitement with rock solid safety.
Unlike those exotic investments, savings bonds are backed by the full faith and credit of the United States government, making them a sure bet in even the most severe bear market.
Savings bonds have a number of important advantages over other types of investments, starting of course with their rock solid safety and stability.
Savings bonds are a safe investment, perfect for retirees living off their savings and workers getting ready to trade their day jobs for a life of leisure.
In addition to their safety savings bonds also provide a convenient and highly accessible way to invest.
While many mutual funds require an up front investment of $3,000-$5,000 or more, an individual can purchase a savings bond with a face value as low as $50.
These low denominations make it easy to invest on a regular basis as well, and many people choose to buy a new bond every month.
Making regular purchases in this manner allows individual investors to accumulate a significant bond holding over time, boosting retirement income and providing safety and peace of mind.
Savings bonds also provide a competitive interest rate for such a rock solid investment, with the rate of return adjusted twice a year in May and November.
A number of factors affect the rate of return on such bonds, including the state of the market for government securities, and in the case of inflation protected bonds the consumer price index.
Another great thing about savings bonds is that the interest they earn is exempt from local and state taxes, making them a great choice for investors living in high tax states and localities.
In addition, any federal taxes due can be deferred until the bond matures or has been cashed.
With all these advantages it is no wonder so many newly risk averse investors are taking a second look at safe investments like savings bonds.
While they may not be exciting, many investors view that lack of excitement as a very positive thing indeed.
Tilting less toward high risk stocks and mutual funds and more toward safe fixed income investments like government securities can be a good move in a difficult market.
In fact the recent turmoil in the stock market has caused many investors to take a second look at good old fashioned savings bonds.
While they may lack the flair of credit default swaps and sub prime mortgage backed securities they make up for that lack of excitement with rock solid safety.
Unlike those exotic investments, savings bonds are backed by the full faith and credit of the United States government, making them a sure bet in even the most severe bear market.
Savings bonds have a number of important advantages over other types of investments, starting of course with their rock solid safety and stability.
Savings bonds are a safe investment, perfect for retirees living off their savings and workers getting ready to trade their day jobs for a life of leisure.
In addition to their safety savings bonds also provide a convenient and highly accessible way to invest.
While many mutual funds require an up front investment of $3,000-$5,000 or more, an individual can purchase a savings bond with a face value as low as $50.
These low denominations make it easy to invest on a regular basis as well, and many people choose to buy a new bond every month.
Making regular purchases in this manner allows individual investors to accumulate a significant bond holding over time, boosting retirement income and providing safety and peace of mind.
Savings bonds also provide a competitive interest rate for such a rock solid investment, with the rate of return adjusted twice a year in May and November.
A number of factors affect the rate of return on such bonds, including the state of the market for government securities, and in the case of inflation protected bonds the consumer price index.
Another great thing about savings bonds is that the interest they earn is exempt from local and state taxes, making them a great choice for investors living in high tax states and localities.
In addition, any federal taxes due can be deferred until the bond matures or has been cashed.
With all these advantages it is no wonder so many newly risk averse investors are taking a second look at safe investments like savings bonds.
While they may not be exciting, many investors view that lack of excitement as a very positive thing indeed.