Are you planning to double your money with a short-term investment? Do you know more about the interest rate? Have you ever enjoyed investing in some platforms, offering short-term profit on your investment? If you want to find out the answer to these questions, you should keep on reading.
In this article, you will learn which are the five best short term investments in 2019. The knowledge of how to invest and where to invest will help you decide what your next step should be. Following are the best short term investments for this year. Let’s take a look at them.
Certificates of Deposit
To be precise, there is no particular definition of short term investment. Officially, when you are expecting a profit on your investment within less than a year, you call it a short-term investment. So, whenever you are thinking about short-term investment, start with Certificate of Deposits (CDs).
CDs give you lots of options and range from a few months to more than five years. However, after purchasing your CD, you need to wait for its maturity. The bank can let you know when your certificate is going to mature.
Moreover, you can receive the specific profit on waiting for the maturity period after purchasing CDs. Otherwise, if you sell it before the specified maturity period, the bank may charge you a penalty. So, it would be wiser to keep it until it matures.
Invest in Stock Index Funds
Stock index funds are a great investment option for both long-term as well as short-term investments. And because of their low costs, index funds consistently outperform the majority of their actively managed competitors.
However, not all index funds are low-cost. If you have decided to invest in index funds, don’t just pick a random index fund. Take the time to study them as well as the market. Moreover, you should compare the expense ratio of the index fund to the expense ratios of other index funds.
Online Savings Account
Have you ever heard about online savings accounts? Well, the online savings account offers you interest profit. This type of account allows you to dispose of funds while you generate savings. It also provides security and options for higher yield of your investment.
However, the only thing you need to do is save your money for the specified duration. For example, let’s say you get 0.01% interest annually. Well, you need to keep your cash in your account for one year, at least.
Moreover, you can search which bank is offering more profit on savings accounts and invest your money there. Remember that if you draw your cash before the specified period, you cannot enjoy the profit. Some online savings accounts provide interest up to 1.2% on your annual savings.
You do not know the stock market, and you don’t want to have an online saving account? Well, municipal bonds are the go-to then. Municipal bonds are loans investors make to local governments. Cities, states, counties, or other local governments issue them.
Have you invested in other bonds? There is a drawback of investing in bonds. Your earned interest is taxed. However, investing in a municipal bond may save you from the tax cut. Municipal bonds are free from state income tax, as well as federal income tax.
If you decide to invest in bonds, you must wait for the specified period. Then you can enjoy the interest profit of up to 2% on your invested money.
Have you ever borrowed money from any individual? Did you give a loan to any person? Well, you might want to consider investing in Lending Club.
Lending Club has been transforming the banking system. The peer-to-peer lending model is something many people are looking for. Here you invest your money via giving loans to individuals or companies. They get that loan for the specified time and pay back your cash with interest.
Moreover, the interest is applied annually or as per the policies of the Lending Club. The best thing is that you can start investing from $25 and invest up to thousands of dollars. Also, you can get a high profit on your return.
Furthermore, you can give your money as a loan for one year or as per the recommended by the Lending Club. It is effortless. The best part is you don’t need to have much knowledge of this quick investment. However, don’t forget to do in-depth research before you choose a Lending Club.
There are many other ways in which you can invest and enjoy high returns. However, these are the five best short term investments in 2019. What you need to do is think keenly and research well before you invest.