Are you looking for the safest investments you can make this year? The stock market was solid in 2021, and experts say it will continue to do so in 2022. This is amidst the threat that the pandemic imposes on the economy.
What investment opportunities should you look forward to? Read on to find out some of the safest investments this 2022!
Investing in Bonds
Before we dwell deeper, it’s important to know that bonds are company loans. So instead of getting a loan from the bank, a company will get the money from investors who sell their bonds.
The company and the investor will go over the terms of the bond, such as the annual interest rate. Once you’ve bought a bond from the company, the company will start paying you the interest on the dates you determined. Most companies pay either annually or semiannually.
When the bond matures, the company will return the capital they loaned from you. For instance, you’ve bought a bond that will mature in 5 years. You also agreed to receive your interest payment every six months.
Within those five years, the company will pay you the interest rates every January and August. When the bond matures after five years, you’ll get your capital back. This makes it one of the safest investments to make, especially if you get one that the government is offering.
This 2022, for instance, the U.S Treasury is issuing bonds for individual investors. Series I bonds are one of the smartest investments to make as the terms cover inflation rates.
Invest in Series I Bonds This 2022!
The Series I bond pays not only a base interest rate but also adds a component based on the inflation rate. This means that if the inflation rate rises, your payout will also rise and vice versa. Inflation adjustments on your payouts will take place every six months.
If you’re looking to avoid any risk of default, the Series I bonds are some of the safest investments to make this year! However, do note that investors can only buy $10,000 in any single calendar year.
Here’s more, if not redeemed for cash, Series I bonds earn interest for 30 years. So those who can’t wait that long can redeem the bonds any time after 12 months.
The downside is that you’ll have to pay the penalty worth three months of interest. To avoid penalty charges and get the most of it, only redeem the bonds five years after the purchase.
Investing in Blue Chip Stocks
We call the shares of large and well-known companies are blue-chip stocks. The names of these companies are household names. Think of company names such as Coca-Cola, Apple, or Walt Disney.
Blue-chip stocks are commonly believed to be one of the safest investments to make any year. This is because blue stock companies are popularly thought to have the capacity to weather out economic downturns.
Coca-Cola, for instance, is one of the companies that successfully surpassed economic recessions. Even with the economic recession in 2008 and the pandemic, its stocks continue to stay strong.
This is because drinking Coca-Cola products is one we can’t do away with. Especially with the rising global temperature.
Another blue-chip stock to consider is the stocks of Apple. Investing in Apple is one of the smartest investments you can make today. To this day, the company enjoys tremendous popularity across the world. They have innovative Macintosh computers down to its iPhone series and Apple Watches.
Apple’s products are one of the most sought products in the technology sector. Not only that, but Apple also has recurring revenue thanks to its iTunes, App Store, and AppleTV services.
Still not convinced? How about the fact that Apple recently hit a $3 trillion market cap? Apple is a blue-chip stock that you can invest your money in this 2022!
Advantages of Investing in Blue Chip Stocks
As we’ve said, blue-chip stocks offer great stability to their shareholders. Moreover, blue-chip stocks also have a better return even during dramatic economic downturns.
In terms of long-term prospects, investors of blue-chip stock can have more confidence than investors of less established companies. Also, most blue-chip stocks pay considerable dividends. They have improving payout growth streaks too.
Investing in Real Estate
Contrary to popular notions, the real estate industry is among the promising sectors to invest in this 2022. As the pandemic progresses, many realtors fear that house prices will significantly drop as they did in former economic recessions. Instead, however, the prices of houses across the world are skyrocketing.
True to this, the United States experienced its highest number of sales of existing homes in 2020. In addition, there was a 9% rise in house prices in 2020, which continues to climb up to this day.
One reason why there is a boost in real estate is that more and more people are paying attention to their houses. As a result, a lot of people have to transform their houses into classrooms and offices. This gave way to what we call the race for “space.”
Wealthier individuals are exchanging their city units for larger suburban homes. This is in anticipation that they no longer have to commute to their central offices. As a result, suburban real estate experienced blissful attention from homebuyers.
Aside from homes, industrial real estate will also continue to experience a boost in 2022. This is especially so for real estate dedicated to logistics, thanks to e-commerce and supply chains. So invest in real estate today and enjoy the benefits that one of the best investments offers.
Take a Chance on These Safest Investments This Year!
To recap, government bonds such as the Series I bonds as well as blue-chip stocks and real estate are some of the safest investments this 2022! So, if you’re an investor looking to bag a fruitful profit, give these three investment areas a try.
There are a lot more things to learn about investment opportunities. Why stop here when we’ve got a load of facts-filled articles for you? Take a detour and check out our latest posts for more interesting articles such as this one.