Investing your money doesn’t have to be a gamble. If you’ve got some savings that you’d like to grow, here are several forms of investment that are practically risk-free.
Open a high-interest savings account
The most basic option is to put your money in a high interest savings account. Nowadays interest rates are lower than ever – you won’t find many accounts with interest rates over 3% – however savings accounts can be easy and convenient. Online savers can be some of the most lucrative and they are easy to open, although you can’t access your money as fast as you can with a brick and mortar bank (if you’re investing and don’t plan to touch your savings for a while, this may not matter).
Consider a CD
Another option could be a certificate of deposit (CD). These are like savings accounts but with much more limited access – you place a deposit in them and can then only access this deposit after a certain period of time, which could be a couple months or a couple years. CDs generally accumulate more interest than savings accounts and they are insured by banks so there’s not risk of losing your money.
Try peer-to-peer lending
Peer-to-peer lending involves giving money to someone else online as a loan – they then pay the money back with interest. By using a secure peer-to-peer lending platform, you can ensure that you will get your money returned from the debtor. Read reviews such as this Lending Club review to find trusted platforms. Peer-to-peer lending interest rates are often over 7% making them a much more profitable option than any saver.
You can also make money with a credit card. By taking out a loan on a 0% interest credit card and putting the loaned money into a savings account, you can generate interest on this money without having to pay interest on the money borrowed. This strategy is known as stoozing – sadly it isn’t as easy as it once was due to lower savings account interest rates. You should also be wary that most 0% APR deals are temporary – you’ll want to pay back your credit card bills before the interest rates rise, which may limit you as to how much you borrow. Still this is a fairly risk-free form of investing that relies wholly on your ability to make repayment on time and keep track of interest rates. You can compare 0% APR credit cards at sites like Upgraded Points.
Pay off your debts
Paying off your debts might not seem like a form of investment, but like investing it can save you money in the long run. Debt accumulates interest over time – by paying your debts off early, you can pay less interest overall and effectively save money.