While fixed-income investments like certificates of deposits (CDs) and bonds aren’t as flashy as equities like stocks, their benefits are plentiful. Not only can they offer more safety and less volatility than investments in the broader stock market. They can also protect your principal while providing predictable returns and steady income.
Before investing in either, it helps to understand the differences between the two—including where to buy them, how each generates returns, and the safety mechanisms that work to protect your hard-earned cash.
