To compare the Series I Savings Bonds vs. Stocks, you must understand the differences of these two types of investments. In general stocks and bonds have some inherently different characteristics.
Let’s compare the differences:
Series I Savings Bonds and Stocks both serve important purposes in the financial world but they are extremely different. I Series Savings Bonds is considered to be conservative with the money invested into it, because after all that money is loan money by US citizens to the US government. If you think about it, if you loan anyone money, you expect that money in return and probably some interest with it as well.
Stocks on the other hand are different, because when you buy a share of stock you are using your money to buy a piece of ownership into that company. And with all companies, once you own it, it is up to how well the company is performing in order for you to make a profit. Relying on the performance of the company then becomes a risk for you, because you only hold a few shares of the company meaning you do not have control over the operations of that company’s performance. There is also the confidence factor with stocks, if many investors feel confident then you are sure to make some money, but if the confidence is negative – your investment will plummet.
When comparing the Series I Savings Bonds and stocks there is a lot to consider. I Series Savings Bonds are safe, but may not generate enough bang for your investment buck. The Stock Market can generate huge financial gains, but there can be significant losses and disappoints in between. Experts would advice having a portfolio with a mix of these types of investments so one could experience the best of both worlds.
