By Tim Stephenson

In a time of economic uncertainty, including an environment highlighted by low interest rates and stock market volatility, I’m often asked “Is there a perfect investment out there for me?” If this were a perfect world, the answer would be an investment that had certain, ideal characteristics:

  1. A high rate of return: A total return high enough to outperform inflation and taxes, and still meet the investment goal.
  2. Complete safety: There would be no concern that any portion of the investment could ever be lost.
  3. Always liquid: An investor would be able to redeem the investment and receive cash at any time, without any penalty or loss of principal.
  4. No income taxes: There would never be income tax due on the investment’s yield or growth.
  5. No skill or knowledge required: No special education or skill would be required to manage the investment.

Of course in the real world, the “perfect” investment doesn’t exist. In the real world, individuals must choose from a range of investment tools, each with different characteristics and uses, and some confusing to understand. Be sure to seek professional investment advice from an experienced and trusted financial advisor during your investment search.