Treasury bills, notes, bonds and TIPS are some of the safest options for elderly people looking to invest their money. These investments offer a low-risk option with a typical interest rate that is lower than other investments. Many retirees rely on their own savings for a portion of their retirement income, such as traditional and Roth IRAs, retirement plans like 401 (k)s, 403 (b)s and SIMPLE IRAs, and taxable investment accounts. In addition to these options, elderly people may also consider investing in collectibles, antiques, and property.
Many seniors sell their primary residence and reduce its size, often investing part of the profits in additional income. It is important to have access to cash for expenses such as a new car, home repairs, vacations, or medical care. Safe places to store cash for short-term needs are money market accounts, certificates of deposit and Treasury bills. These secure investments provide a small return in the form of interest and return of principal. Conservative investors prioritize return on capital over other factors; they don't want to lose money.
It is important to plan for the future and ensure that sufficient income this year will extend far enough to pay the bills 10, 20 or more years down the line. Individual retirement accounts (IRAs) are a common option for seniors. You can open an IRA with an online broker, an automatic advisor, or a mutual fund company. Money market accounts usually have a high minimum deposit requirement but they pay high APYs in return.
You can make up to 6 withdrawals per month with this type of account, so only deposit funds that you can keep immobilized for a period of time. A money market account is a safe investment for obtaining cash. Money market accounts offer a fixed interest rate with little or no risk. If you have the money you need to be liquid and you don't want to risk it, this is an excellent option. Treasury securities are relatively safe investments and some pay semi-annual interest to give you some cash flow while you wait to collect the face value of the investment. If you're looking to increase your portfolio during retirement while maintaining some level of conservatism, consider investing in a money market account, investment fund, preferred stock, life insurance, certificate of deposit or Treasury securities.
Reverse mortgages are also an option to explore if you are considering aging in place or downsizing your current home. Many aging seniors leverage their home equity through a HECM to help supplement what they receive from Social Security, pensions, 401 (k)s and other retirement assets.
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