Short term Investment? Yes, people keep on asking and searching over the net trying to figure out what are the best short term investment available in the market presently. But why? The market situation is schizophrenic and the interest rates are so low. This is due to the unstable situation persisting that people are relying more on short term investment due to safer options. Short term investing essentially permits the investors to invest their money with almost no danger of being converted as bad debts as you totally have the knowledge won’t be tied up for a long period of time.
The duration of the short term investment typically is for a few months, or a couple of years ,which can easily be acquired as cash on maturity or if you again want to re-invest that too in short term investment you can do that also. On the other hand,long term investment does take a long period of time for that particular investment to get matured, which in fact leaves little option for you to re-invest in the same policy, as it often takes decades to actually get matured.
In reality short term investment renders very low return, but the greatest advantage of the same as they can offer more access, liquidity and security of your hard earned cash in safer hands than long term investment vehicles like bonds, stocks, investing in real estates or even buying gold or silver as already discussed. The following are the various options of short term investment for you to actually take hold.
Certificate of Deposit
You can opt for the Certificates of deposits (CD) which are available in banks. The time frame of these deposits is usually between 3 to 60 months. Longer investment periods will fetch you more interest rates than you invest for a minimum of three months. CDs are good investment options as there is hardly any risk involved as safeguarded by the FDIC. However the funds are not so fluid as you are restricted to take out your money till the maturity period is over. If you by any chance need for the hard card in immediate effect and take out your money before the maturity period is over you are bound to pay the penalties which is usually that of three months. The best thing to do is for you to calculate when you will be needing the money and investing for that particular time period.
US government notes and bills
The Government of United States issues government notes and bills. The treasury bills matures within less than a year while the treasury notes take around two to ten years. You can just close your eyes and invest in them as it is fully supported by the US government and considered the safest investment that you can ever think of. To add up to your advantage there is no commission charged and can invest it online just logging on to TreasuryDirect.gov. There are also other benefits like it is exempt from tax both state and local. But you do have to pay a penalty if you happen to withdraw your money before the treasury note matures. Moreover the return that you intend to get is on a very lower scale that may make you shift gears opting for riskier bonds with higher returns.