When planning your investment strategy, you should first consider your objectives, the amount of money you have to invest, the associated fees, and the amount of risk you're willing to take with your money. Usually, the greater the risk of an investment, the higher the potential return. Riskier investments include corporate bonds and mutual funds. The interest earned on bonds, called dividends, is paid throughout the term of the loan. The bond principal will be repaid when it matures, along with the interest earned. Mutual funds are pooled portfolios of investment securities purchased on behalf of the investor and managed by investment professionals. Some people are more comfortable with secure, guaranteed-return investments like bank C.D.s, money market accounts, and savings accounts. Generally, government securities are some of the more secure investments you can make. Treasury bills, notes, and treasury bonds are basically I.O.U.s from the government with different maturities, ranging from thirty days to thirty years. Certificates of deposits, known as C.D.s, insured for up to one hundred thousand dollars by the FDIC, are another secure investment option. For more information on developing your personal investment strategy, contact a financial advisor.
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