For example, people buy food no matter what is happening in the economy but may postpone a vacation or car purchase during a recession. The safest of all are Treasury securities, which are debts of the U.S. government. Notes run from 2 to 10 years and bonds are issued for 30 years. The rate paid to investors is determined by periodic auctions. Interest on Treasury securities is exempt from state income tax.
Investors typically buy and hold UITs until the trust dissolves at a future date.
Periodic interest or dividends are paid. Funds are constantly buying and selling securities. Some mutual funds include more than one asset class in varying proportions and provide broad diversification at a low cost. These funds include balanced funds, which include stocks and bonds and asset allocation and lifecycle funds, which include stocks, bonds, and cash in varying proportions. First, if you're self-employed, invest in a SEP or Keogh plan.