- $20K cash
- "Invest on something safe"
- Earn more than FD (which I assume stands for fixed deposits).
Sunday, July 8, 2012
Query from Reader - $20K to Invest
I don't usually do this but I got a query from a reader recently asking me what safe instruments one could invest in that will provide a better return than fixed deposits (FD). Based on the sketchy information provided, here are the following facts that I got from the very brief email:
Firstly, I think the reader must ask himself whether the $20K in cash is really spare cash. Has he/she set up an emergency fund of 6 months expenditure (or for the kiasu ones - 6 months income). Without questioning too much, I assume that he/she has already set aside money for an emergency fund and this is really SPARE cash to invest.
Secondly, I deduce that the reader is probably risk adverse. Capital protection is probably key to him/her. Stocks with their high volatility are perhaps not suited for everyone (even though I strongly recommend it to most people).
One of the few options I can think of is to invest in SGS bonds. That will give a better return than FD. However, at the same time, the returns from bonds are not spectacular at all (at least to me). Personally, I don't invest much in bonds (not directly anyway).
Any thoughts from other readers?
Categories: Investing Tips
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