What is conservative investing?
How risk averse are you? Conservative investing is when you want your money to grow but are afraid of losing your principal investment. A portfolio that is more heavily weighted with bonds than stocks is considered conservative.
Where have you heard about conservative investing?
Many of us take a conservative approach to investing as we’re scared of losing our hard-earned money. People who are nearing retirement or don’t have a lot of capital to play with may be more inclined to stick to low-risk investments.
What you need to know about conservative investing.
There was a time when you could conservatively build your wealth through savings accounts, but paltry interest rates in recent years have seen savers look for other options.
What if you have a low risk tolerance and don't feel very comfortable with the stock market? A happy medium between stocks and savings is bonds. Generally speaking, they offer more stability and predictability than other investments, although no investment is 100% risk free. They give you a steady stream of income and you can expect to get your principal back at the end of the bond’s life. The lowest-risk options are government and highly rated corporate bonds.