Financial experts always say to diversify your money. But what do they mean by that? And how can a senior diversify their investments without financial risk?
As we all get older and maturity kicks in, we start to focus on different ways we can live a healthier and wealthier lifestyle.
None of us want to lose our money and hope to invest in safe, low-risk investments such as a 401k or Savings account.
But those classic investments aren't always the best options for seniors, especially if they have low balances or high-interest rates. In our guide, we discuss options such as gold investments which can a be a safe-haven asset for seniors.
Below are six safe and low-risk investments that may be worth consideration by elderly investors:
- Real Estate or REITs
- Gold IRAs
- Stocks Such As the Dividend or S&P 500
- FDIC-Insured High-Yield Savings Account
- Money Market Account
Side Note: Always consult a financial advisor before investing. Our goal is to provide you with a health of safe options and dodge shady business ideas, but make sure you do your research before investing in anything.
What Are Some Safe Investments For Seniors?
If you're a senior, investing your money can be tricky. You don't have the same time constraints as younger people, and you may be more risk-averse.
That's why it's essential to have a few safe investments in mind. Let's jump into different options depending on your situation.
One of the best things you can do is choose a low-risk investment. You might be surprised that some safe options are out there, even if they aren't as popular as other financial tools.
One of the safest investments for seniors is real estate or REITs (real estate investment trusts) and IRAs. These companies make money by investing in and managing real estate properties.
This means minimal risk since it's usually difficult for these companies to lose money. In addition, interest rates on certificates of deposit (CDs) and savings accounts are often higher.
1. Gold IRAs
There are a few things to keep in mind if you're thinking of investing in gold through an IRA gold company. First, you can roll over or transfer your 401k into a Gold IRA, which would open up your investment options.
Augusta Precious Metals
This is an allocation from:
- Traditional or Roth IRA
- Self-directed 401(k)
- Employer-sponsored 401(k)
- SEP IRA
Second, interest on these accounts is tax-deferred so that you will save money over time. You can also invest in other precious metals, such as silver and platinum, without selling your home or taking on any extra debt.
All of this makes owning gold via an IRA account a sound financial decision for seniors who want the security of knowing their money is safe while providing them with opportunities for future growth.
2. Real Estate, Including REITs
Real estate can be one of the most lucrative investment options for seniors and even a younger investor looking to make much more money in the 2020s.
There are a few different types of real estate investing, including investing in individual properties, buying property portfolios like apartment complexes, or investing in REITs that own real estate holdings across the country.
When purchasing an individual property, it's important to research and understand the market conditions before making an investment decision. When investing in a portfolio of properties, you're typically taking on less risk since you're responsible for only one piece of real estate instead of multiple investments that could go bad at any given time.
A REIT offers investors two low-risk advantages: risk diversification and the potential for high returns. By investing in various real estate holdings, REITs can offer stability during volatile market conditions while offering the potential for large gains over time.
3. Certificates of Deposit
Certificates of deposit (CDs) are an excellent way for seniors to save money and provide low-risk investments. Similar to high-yield savings accounts, you can make much more money than a traditional savings account.
They offer high returns, low risk, and stability over time. There are various types of CDs available that fit different investing needs. Find the right one for you by looking for an FDIC-Insured bank online or at your local bank.
You can also ask your bank advisor about the benefits of using their CD or just go online and view what others have recommended.
4. High-Yield Savings Account
Several high-yield savings account options offer better interest rates and higher returns on investment than other deposit options. Make sure you read the fine print before putting money, as some of these accounts have high fees.
Some of the best high-yield savings account options include online certificates of deposit (CDs), variable-rate savings accounts, and treasury bills.
We recommend online banks such as Marcus by Goldman Sachs and Ally.
We love this option because you don't need to wait a certain period to take out the earnings. You can immediately give yourself a payout and take out the funds from your baking institution.
These account types offer higher interest rates in the short term but have less risk because governments or financial institutions back them.
5.) Money Market Accounts
Money market accounts are one of the safest and most reliable investments. They offer high returns on investment and are ideal for seniors who want to grow their money without investing in risky stocks or bonds.
Most Accounts are accessible without needing to deposit any funds upfront, which can lead to more purchasing power for you as an investor.
Essentially, a money market account is like a checking account that offers high-interest rates. You can find money market account options with variable or fixed interest rates, so read the fine print before adding deposit insurance.
6.) Stocks & Low-Volatility Options
We all know the stock market can be very risky depending on your investment and how much money you put in.
Many safe options are available regarding stock investment, and research is key to finding these.
Here are a few potential opportunities and preferred stock options we found online:
- S&P 500
- Dividend stocks
- Treasury bonds
- Common stocks such as Apple or Tesla
- Most Index funds
Investing is always risky, but low-volatility stocks can minimize this risk. By investing in stocks that have a low volatility rate, you are limiting the amount of money that can potentially be lost in one day or week.
By default, most new investors try opening an account with their bank, but you can use a more experienced platform like Vanguard. Vanguard will help you with with a bear market and dodge higher-risk trades.
Something you will appreciate during your golden years. Remember that high-risk investments such as penny stocks and Initial Coin Offerings (ICOs) should generally be avoided unless you have experience and understand them well.
Instead, focus on looking for stocks with good long-term potential prospects and something that makes them more stable over time. This can become a reliable income stream and good option for consistent income.
FAQ For Seniors In Retirement That Are Ready To Invest
Retirement is a time of reflection and planning. And while it's essential to make financial preparations for this time of life, it's also important to know about options that seniors may not have heard of.
In this part of our blog post, we'll discuss and ask the most important questions for seniors' who want safe investments for 2023. Read on to learn more about these options and how you can start diversifying your investment options.
What Is The Safest Way To Invest Money For Seniors?
Seniors are often advised to invest money in mutual funds or exchange-traded funds (ETFs) through brokerage firms, as these vehicles tend to be more stable and provide growth potential.
For seniors who want a bit of risk, choose stocks instead of mutual funds. However, always research before investing, so you don't want to lose money on an investment that isn't safe for seniors!
Fixed annuities offer the peace of mind that income will be there no matter what, while variable annuities come with the flexibility to change rates depending on market conditions.
Since most of us, including seniors, don't actively study personal finance or trade daily in the open market, financial advisors can help manage risk and grow money for their clients.
As a senior might not have much experience investing and might not understand all this financial jargon, it's good to consider a mix of both types of annuity so they can get the best protection for their money.
How Can Seniors Make Money After Retirement?
During and after retirement planning, many seniors turn to invest their money. While many options are available, seeking financial advice from a certified financial advisor is vital before making investment decisions.
This way, you can ensure that your money is invested wisely and risk-free. Some of the investments senior citizens can consider include property investments, hedge funds, and mutual funds. These offer decent returns with low fees, perfect for those who want steady income in the short-term or long-term.
The bottom line is that not all investments are created equal, and you need to review your risk tolerance after retirement.
Are Gold IRAs A Gold Investment For Seniors?
Are Gold IRAs a good investment for seniors? While there is no one-size-fits-all answer, the truth is that gold is a reliable and safe investment over the long term. It can provide stability, safety, and tax advantages for retirees during these uncertain times.
Besides, you may be surprised to learn that gold is a great investment choice for senior citizens in retirement. Precious metals like gold can help a retiree protect their money from inflation and other market fluctuations.
When investing in a gold IRA, consulting with an advisor who understands the market is important. Additionally, keep in mind that there are penalties for the early withdrawal of funds from a gold IRA provider. Contact a rep custodian to learn more about how you can make money as a senior citizen through safe investments like gold IRAs.
The Bottom Line For Seniors
Investing for seniors is a complex and delicate process. However, by investing in a few safe investments, you can help ensure that your money is well-protected during retirement.
Our blog article has outlined six safe investments for seniors you may not have heard of. So, if you're interested in investing for your future, check out other related content below.