Many people are aware that having long-term financial goals is great. But how about meeting current financial goals without having your money tied somewhere for a very long time? Which is the short time investments.<\/p>\n\n\n\n
However, are there short-term investments with little or no risk that would yield returns?<\/p>\n\n\n\n
This article will discuss the best short-term investments you can engage in with good returns.<\/p>\n\n\n\n
Short-term investment is a type of investment that isn’t intended to be long-term which you can easily convert to cash.<\/p>\n\n\n\n
It is one investment you can hold for half a year or for one full year. There are also some short-term investment options where its position can’t be held for more than a day sometimes. One of which is foreign exchange trading.<\/p>\n\n\n\n
You can eventually turn an investment into a short-term investment if you can sell it quickly.<\/p>\n\n\n\n
If you are an investor in stock and you want to maximize short-term investment, then you will need not hold it for a very long time.<\/p>\n\n\n\n
Investors store money temporarily using this term as they wait to transfer to another investment with higher returns.<\/p>\n\n\n\n
Examples of short-term investment include the Money market, CDs, Government, Treasury Bills, etc.<\/p>\n\n\n\n
The goal of every investor is to generate returns as well as protect their capital.<\/p>\n\n\n\n
For a company to classify an investment as a short-term investment, two (2) requirements are needed.<\/p>\n\n\n\n
Marketable debt securities also include corporate bonds (bonds issued by another company). It should be traded, considered liquid, and have a short maturity time.<\/p>\n\n\n\n
Below are the 10 best short-term investments with low-risk and high returns<\/p>\n\n\n\n
A savings account is one of the best short-term investments. When you save your money in your bank, you are giving a loan to the bank. Therefore, you earn interest in your account.<\/p>\n\n\n\n
If you are willing to leave your money for 1-5 years, you will accumulate a large amount of money in your savings.<\/p>\n\n\n\n
This is like the corporate bond. It isn’t issued by the corporation but by the Government.<\/p>\n\n\n\n
Government bonds issued by the U.S. Treasury are considered one of the safest bonds in the world and one of the best short-term investments.<\/p>\n\n\n\n
It is considered one of the low-risk investments and, because of this, they pay low-interest rates.<\/p>\n\n\n\n
You can invest in Government bonds as it is helpful in funding some programs like parks, infrastructure projects, and other public services.<\/p>\n\n\n\n
Also, it’s one of the best short-term investments<\/p>\n\n\n\n
This type of security is sold to investors, making it one of the best short-term investments.<\/p>\n\n\n\n
It’s similar to a loan. The company pays back the investor for the amount which is paid. And there is a maturity date and interest rate.<\/p>\n\n\n\n
Corporate bonds are safer than stocks. In the corporate bond, the investor returns his money with interest, but the stock is riskier because the money may not increase in value.<\/p>\n\n\n\n
Corporate stock is the share of the company, which gives an investor a little degree of ownership. Dividends are given to the investor on the stock. And the value appreciates or depreciates in value which depends on the success of the company.<\/p>\n\n\n\n
READ ALSO: What Are Securities In Finance? Overview And How It Works<\/a><\/p>\n\n\n\n Two types of treasury securities are safe. T-bills and T-notes.<\/p>\n\n\n\n T-bills have the shortest maturity terms ranging from 4 weeks to 8 weeks.<\/p>\n\n\n\n T-notes pay interest semi-annually and their maturity terms range from 2 to 10 years. They are both the best securities for short-term investments.<\/p>\n\n\n\n This money market is an account that stands between a checking account and a savings account.<\/p>\n\n\n\n To enjoy the flexibility of a checking account with high interest from the high-yield savings account<\/a><\/strong>, then opening a money market does it.<\/p>\n\n\n\n A money market account<\/a> allows you to use a debit card and write a check. It limits you to six withdrawals per month following Government limitations.<\/p>\n\n\n\n Banks and credit unions offer money market account. A money market account has stricter requirements than a savings account, just like a high yield savings account.<\/p>\n\n\n\n It is also regarded as one of the best short term investments.<\/p>\n\n\n\n This is an account where you keep a large amount of money, leaving it untouched for a certain period of time.<\/p>\n\n\n\n You earn interest for it but will be charged a penalty for early withdrawal.<\/p>\n\n\n\n This could be a good option if you are saving for a longer period.<\/p>\n\n\n\n The best CD rates are better than the money market or savings account.<\/p>\n\n\n\n CD terms vary from the range of 6 to 18 months. Most CD terms fall within the short term investment period.<\/p>\n\n\n\n It could be a way of putting your money to work for you so long you would be disciplined.<\/p>\n\n\n\n Here, no middleman is involved as it is where an individual takes a loan from another. It is also called social lending and has been in existence since 2005.<\/p>\n\n\n\n There are sites that facilitate this. You open an account on the site and deposit some amount of money which will be used as a loan.<\/p>\n\n\n\n They will match you up with loan applicants who have created their own accounts. Risk is also involved, so you have to choose your applicants carefully.<\/p>\n\n\n\n There is a high interest rate here, but for a short-term investment, you can grant loans that mature in 5 years.<\/p>\n\n\n\n Brokerage firms issue this type of account. Most of the accounts are similar to checking accounts which come with a checkbook and debit card.<\/p>\n\n\n\n This account is good if you are an investor and have an account with brokerage firms. Cash management accounts have services that help maximize your investment profits.<\/p>\n\n\n\n It’s a type of account that holds retirement funds. It is known as the Individual Retirement Account (IRA)<\/p>\n\n\n\n It is the opposite of the traditional IRA.<\/p>\n\n\n\n With Roth IRA, your withdrawal is tax-free, but you pay tax on your contributions.<\/p>\n\n\n\n It doesn’t pay interest, but when you open it with a brokerage firm, you earn compound interest.<\/p>\n\n\n\n By maintaining a Roth IRA account<\/a> in a brokerage firm, you increase your earnings in a short term investment.<\/p>\n\n\n\n Though it’s a long-term investment.<\/p>\n\n\n\n Some of the reward checking accounts include:<\/p>\n\n\n\n They offer high-interest rates, but they require a minimum balance.<\/p>\n\n\n\n They offer great services like financial advice<\/a> and discounts<\/a>. Some of their discounts help save you some money. They also offer high minimum balance requirements.<\/p>\n\n\n\n Short-term investments are beneficial and they generate interest within 5 years. It helps supply you with steady cash flow. And before diving into short-term investments, be aware of the risk and also highlight your investment goals.<\/p>\n\n\n\n Before investing, you need to determine<\/p>\n\n\n\n <\/p>\n","protected":false,"gt_translate_keys":[{"key":"rendered","format":"html"}]},"excerpt":{"rendered":"Many people are aware that having long-term financial goals is great. But how about meeting current financial goals…\n","protected":false,"gt_translate_keys":[{"key":"rendered","format":"html"}]},"author":20,"featured_media":15196,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[52],"tags":[],"yoast_head":"\n#4. Treasury Securities<\/span><\/h3>\n\n\n\n
#5. Money Market<\/span><\/h3>\n\n\n\n
#6. Certificate of Deposit<\/span><\/h3>\n\n\n\n
#7. Peer to Peer Lending<\/span><\/h3>\n\n\n\n
#8. Cash Management Account<\/span><\/h3>\n\n\n\n
#9. Roth IRA:<\/span><\/h3>\n\n\n\n
#10. Rewards checking account<\/span><\/h3>\n\n\n\n
\n
\n
Conclusion<\/span><\/h2>\n\n\n\n
What should I consider before investing?<\/span><\/h2>\n\n\n\n
\n
References<\/span><\/h2>\n\n\n\n
\n
Recommendations<\/span><\/h2>\n\n\n\n
\n