Co-founder of Affari Miei
January 12, 2024
In the era ofeconomic uncertainty, investment security is a growing concern for many. But what are they really? safe investments and which ones are only perceived as such?
Today we’ll dive into just that complex world to try to understand howdefend ourselves” and how to best choose an investment that can then help us reach our goal.
I tried to analyze the situation in this video:
Let’s start!
This article talks about:
Safe Investments
Let’s start with a rundown of safe investments which are able to make us obtain returns, even if not exciting, but in exchange offering us the security and certainty of not risking too much, therefore not having to worry about seeing our investment graphs turn red.
Deposit account
Il deposit account it is one of the safest investments you can make. It offers a guarantee of up to 100,000 euros thanks to the interbank deposit guarantee fund.
Furthermore, since 2022, the interest rates on these accounts are increasing, and this is making them even more attractive to investors. It is a safe investment, capable of remunerating your savings.
Postal Interest-bearing Coupons
I postal savings bonds they are another investment considered safe, thanks to the guarantee offered by the Italian State. The interest rate varies based on the term of the voucher, making it a flexible option for different time horizons. They also have an advantage from a taxation point of view.
Short-Term Bonds
The bonds, especially government bonds issued by developed countries with moderate government debt, are a solid option. The short maturity reduces the risk of default, making these bonds a prudent choice.
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Investments Mistakenly Perceived as Safe
Now let’s see what are those investments that people often identify as safe investments, but which in fact I’m not.
Mutual Funds and Bond ETFs
Contrary to common perception, i Mutual funds and bond ETFs aren’t always safe. Security depends on the type of underlying asset and the maturity of the bonds in the fund.
Insurance Policies
The insurance policies, often sold as safe investments, can hide high costs and complex future management, making them less safe than they appear. In fact, these are often really complex products to understand, which hide many pitfalls within them that less attentive investors do not notice.
BTPs and Long-Term Government Bonds
I BTP and other long-term government bonds expose the investor to risks related to very long-term dynamics, including the stability of the issuer.
Practical Advice
I personally think there are some advice that you must follow carefully, in order to get the most out of your investments:
Financial Education: the safest investment you can make is in financial education. Knowing the mechanisms of the financial market allows you to make more informed choices and effectively manage your assets;
Diversified Portfolio: a diversified portfolio is essential to balance risk and return. Understanding diversification and applying it to your portfolio can mean the difference between financial success and failure.
Conclusions
In an increasingly complex financial world, the key to a safe investment it is a combination of financial education and portfolio diversification.
Before investing in any asset, it is essential to make a thorough assessment of the risks and potential returns.
Only in this way can we aspire to truly manage our assets effective and safe!
In fact, my advice is always to study and train, because only with training and by increasing your awareness of the world of investments will you be able to invest in a safe and clear manner, without being afraid of making wrong or reckless choices.
Precisely regarding this point, I would like to leave you with some useful resources capable of helping you take the first steps and above all capable of guiding you in choosing the investment path best suited to you:
Good investments!
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