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Three Safest Ways To Start Investing in Bonds

2 Important Keys to Learn How to Start Investing Safely Without Stress and Too Much Time Commitment

Here’s the situation – for every $1000 you put in the bank, you earn at MOST $1 per year. Yet the bank is taking your same cash and earning at least $30 on it. And doing it totally legally. (Actually, that is being really conservative on the bank’s part, they are usually raking in around $100 per each $1000.)

Today’s first video will show you two keys that can start earning you at least 30 times more of what you would if you have your cash in the bank – safely, without stressing about the risk factor, and not a lot of time commitment.

And if you’ve already been investing by either having a portfolio that you don’t know what to do to make it grow or have lost a bundle due to risky investments, these easy-to-follow steps will help you build that portfolio up.

Related Read: Can You Start Day Trading With $500?

So, are you ready to rock?




Full Transcript

In the last video, we learned that for every 1000 dollars you’re stashed safely in the bank, you get at most one dollar. While the bank is earning around 30 dollars, sometimes even up to one hundred dollars for your 1000 dollars that you invest today, I’m going to show you how you can earn at least 20, 30, even 40 times more than what you would in the bank.

By investing smartly and safely, I’m Marina Villatoro. So what exactly is fixed income investing? It’s actually quite simple.

Today, I’m going to cover three major categories of fixed-income investing. These three are, in my opinion, the safest possible way to grow your portfolio. And if you want to stay super-conservative, putting the majority of your money into fixed income is a really safe way to grow your portfolio.

Treasury notes

Yearly 20, 30, sometimes even 40 times more than what you would in the bank. The first one I’m going to focus on is government bonds are also known as Treasury notes. Governments pretty much all over the world need money to make progress for whatever it is that they want to do. They could either have a building project that they’re working on roads.

It could be whatever it is that they need at the moment. And what they do is that they put out bonds for people, for investors to lend them money, basically. So what they do is they lend you money.

Whoever decides to buy the bond, and they promise after the mature maturation date, the due date, that they will give you all your money back plus interest. Now, if this sounds too good to be true. Think of it this way. The governments, if you’re not going to lend them the money, governments have to go to the bank. Banks always charge way more interest than they would if they put it out to the public.

So really, it’s a win-win situation. You earn interest and the government has money to put into whatever project that they’re working on. It’s actually a fantastic way to invest and know that you’ll definitely get all your money back. And in the end, you could get all your money back. Plus the interest, what the government promised. But the best part about government bonds is they’re tax-exempt, meaning whatever games you get.

You don’t have to pay any taxes on it, which is pretty amazing because usually for other investment opportunities, you do have to pay taxes on your gains. Again, it’s a win-win situation.

Municipal bonds

The second category and the second-safest possible way to invest with fixed income investing is municipal bonds. Municipal bonds are really just a micro version of government bonds. For instance, a department of a state or a county or even an actual state role.

They all have different projects they need to work on. They need to maybe build a bridge, fix a road, build a new government building. So that needs money. What they do is they put it out to investors to lend them the money at a certain interest.

The interest here is a little bit higher because now you’re much more micro. So depending on the municipality, if they have a little bit more money to pay back again, what’s really great about municipal bonds is the majority of them are tax-exempt.

Corporation Bonds

As for the third category and my most favorite is corporation bonds or known as corporate bonds, corporations, depending on this matter, how established they are from Apple, IBM, which two smaller ones like Ralph Lauren or telecommunication companies.

They all need money. They all need to borrow money. So instead of going to the bank and getting super-high interest rates, they come to us investors. Corporations need money usually if they’re launching a new product or if they want to start a whole new department, if they want to build a new building, whatever it is that they want to do, they actually don’t have to disclose that information to us.

And the great thing about corporations is that they offer a much higher interest in return for when the due date is you get all your money back and interest. And chances are corporations such as Apple or IBM or McDonald’s or whatever is not going bankrupt in like one year that you’re going to lend them the money. So it’s a really safe bet. And yet it could still be construed a little bit as less conservative, simply because the reward is much higher and the risk is a little bit higher. But chances are it’s really safe.

And actually, a fun way to invest. So now that we have the three categories of investing government bonds being the safest municipal bonds, I personally think they’re close ties and then corporate bonds. These are the three safest ways that you could invest in.

Things to know about Bonds

However. There are certain things you need to understand about how to invest with bonds. OK, the first one is the time, the amount of time usually for bonds. You cannot do less than one year. You could do anywhere from one year up to 30 years. I would not recommend 30 years. I would say one year is a really good time because chances are not much is going to happen in one year.

You get a really nice percentage at the end of the year. You could go for five years, but you know, your money isn’t accessible. So if you take it out, you can’t get fine in 30 years. That’s way too long. I personally don’t do not recommend it at all. And the difference in interest between the one year and the five years is not that big. So if you want to continue, what I would do is I would just reinvest.

You could automatically reinvest in the same bond or take that money and reinvest in another bond that you’re interested in. The most important thing is exactly how to invest in bonds. This is the situation with bonds whenever you choose one particular bond.

There is a minimum that you can usually invest with government or municipality bonds is 1000 dollars or more. That’s the minimum corporation bonds. If you focus on one particular corporation, usually five thousand dollars or more. So if you have a lot of money, and you want to find your own. It’s a great way to do it. If you have a certain amount or ten thousand, one hundred thousand dollars, but not many of us have that kind of money. So there are corporate bond funds in the funds.

You have many different corporations, let’s say, or different governments, districts, or different municipalities. You can really decide. There are so many different funds out there. And again, with funds, usually there is a myth.

There is a secret to diversification safely, smartly, and without any limit. Exchange-traded funds, or otherwise known as ETF ETFs. And this is my favorite way to go, and this is the only way I actually invest these days. So you get diversification.

There are so many different ETF out there for all categories, including sustainable ETFs and you can buy you could buy the same day on the stock market like you would buy a stock and sell it either tomorrow or in a year, 10 years. It’s up to you.

But if you sell it for less time than the actual fund, the actual bonds, what it is the interest rate gets pro-rated and added to your account. Also, there is no limit. You could buy one share or you could buy a thousand shares. It’s completely up to you. So it’s all pro-rated if this is the best way to go. And personally, it’s the only way I do. I trade these days. OK, so now what? What do we do next? Right.

I know you’re probably thinking the same thing. There are so many bands out there. Where do we start day trading? How do we know which is a good one? How do I know which is a safe one? I felt the same way when I started. So I have a bonus free down below.

If you click a PDA file that I’ve made for you, which breaks down, which has some of the top fixed-income investments for this year and they’re usually the majority of them are exchange-traded funds.

If you want to learn more about the other types of funds, please contact me and we could talk about it, but I’d really prefer exchange-traded funds. They’re easy as they’re the safest and there are no deadlines. You don’t have to pay any fees and you get the pro-rated interest. It’s really the best solution for you. Now.

I want to hear from you. What steps are you going to take to start building your portfolio? What fixed incomes are you most interested in? I’d love to hear from you. You could either write me a comment below or you can contact me directly. I’d love to hear from you. And if you have any questions, please let me know. And remember, ladies, investing can be simple and fun.

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