What Is a Good Investment?

A good investment is one you put some thought into.

A good investment is one that meets your goals and objectives. Before making any investment you should walk through the questions in How to Make an Investment Plan to clarify what you want to accomplish with your investment. Then you can begin aligning your goals with the choices below to determine which of the following might be a good investment for you and your retirement plan.

Are CDs a good investment for retirement income?

Certificates of Deposit
CDs are safe, but are they a good investment?. Comstock/Stockbyte/GettyImages

If your primary goal is capital preservation, meaning protecting the savings that you have, and you are in a low tax bracket, then CDs (Certificates of Deposit) might be a good investment for you. You may have to accept low returns as a trade-off for protecting your principal. The problem with CDs is inflation. Sometimes the rate of inflation is higher than the money you make with the CD. In this case, a CD is no better than a savings account.

Is real estate a good investment for retirement

Real Estate Investing man holding brief case
Real estate can be a great investment, if you do it right. JanStromme/Stone/GettyImages

Make no mistake: investing in real estate takes work. If you do it right, it can pay off. Just don't fall for the seminars that tell you how easy it is. It's not. Rental real estate can be a good investment that produces steady income in retirement, but you have to do your homework before you take on this type of investing. Read more to learn about real estate as an investment. And by the way, just because HGTV shows people flipping houses and making millions doesn't mean you can do it too.

Are annuities a good investment?

piggy bank with stopwatch
Annuities are ok, if they are part of a holistic plan. DimitriOtis/DigitalVision/GettyImages

Annuities can be an appropriate investment, or they can be the worst thing you could put your money into. It all depends on your goals and on the type of annuity. Annuities are insurance products. Insurance products functioning as an investment sometimes come with high fees. This article provides an overview of when an annuity is a good investment and when it isn't.

Is gold a good investment for retirement?

Gold bar
Gold as an investment? Maybe not. YasuhideFumoto/DigitalVision/GettyImages

Is going to Vegas and betting on red a good investment? I think most of you would say no. Betting on the price of gold isn't quite like going to Vegas, but it does have some similarities. Once you understand historical gold prices you can decide for yourself if gold has a place in your investment plan. Gold as an investment has done a whole lot of nothing for many years post-recession and comes with no dividend.

Are mutual funds a good investment?

Mutual Funds listed in newspaper
Mutual funds make great investments for most people. PerryMastrovito/Stockbyte/GettyImages

For most people the right type of mutual fund used appropriately makes a good investment. To find the right type of fund you have to know about mutual fund fees, how to distinguish between actively managed funds and index funds, and how to tell what asset class a mutual fund fits into. If you get a handle on those basics you'll be able to start selecting funds that match your goals. Or get some help.

Is buying a condo a good investment?

man standing in condo overlooking city
Here's what you need to know before you invest in a condo. MichaelBlann/Stone/GettyImages

There are specific questions you can ask, and specific numbers you can look at, to estimate the potential return on a condo investment. Condos can be a good investment, but the numbers have to work out. This article walks through an example of how to estimate the yield on a condo investment.

Best safe investment you can make

100 shares bond
The value of i-bonds never go down. Tetra Images/Getty Images

The best safe investment you can make is one that many people have never heard of. You can buy it online. The value can never go down. It earns an interest rate that is tied to inflation. Sounds decent, doesn't it? It's called an I Bond. Learn more here.

What is a good stock to invest in?

binoculars looking at stocks
Finding good stocks is harder than it looks. DaitoZen/Moment/GettyImages

I find it amazing that people conduct internet searches for the phrase "what is a good stock to invest in" but they do. If you're scouring the internet in this way, watch out. There are some serious fraudsters out there who would love to take advantage of you. There is a better way to invest then searching for internet stock tips and I cover it in this article. HINT: Day trading doesn't work. Trying to time the market doesn't work. Investing for longer periods of time in companies that pay a dividend is one of the safest ways to invest and one that produces results.

What is a good return on investment?

person drawing graph
Before investing, set a realistic return expectation. YagiStudio/Photodisc/GettyImages

One key to finding good investments is having an understanding of what is realistic. What kind of return should you expect on an investment? If you have a good sense of what is and is not possible you are less likely to get scammed. This article will help clear things up.

One way to find good investments? stay away from bad ones!

stock graph downward trend
Learn how to avoid bad investments. Saul Gravy/GettyImages

There are a few ground rules you can use to avoid bad investments. Not all of them are absolute must-follow rules; you can think of them more as guidelines. Particularly if you're a new investor, using these rules to stay away from bad investments can help steer you toward better choices. Don't look for the big, fast wins. You'll get crushed.

What will a good investment advisor do for me?

couple meeting with financial advisor
It might pay to get advice. William King/The Image Bank/Getty Images

If you're not sure how to pick good investments on your own, can an investment advisor help? Maybe. One misconception some people hold is that investment advisors have some insight into what the market is going to do. It doesn't work that way. A good investment adivsor takes the time to understand your goals and put together a long term investment plan designed to achieve those goals.