The 5 best investments for non-taxpayers depend on a number of factors. Just some of them are how much you want to invest; if you are looking for growth, income or both; your risk tolerance; and for how long you are willing to tie up your money in investments. Here are our five best investments for non-taxpayers that will surely leave you with food for thought.
- Corporate Bond Funds. Whether high-or low-risk, Corporate Bond Funds give yields in the range of ten percent a year. The danger is that the higher the yield, the higher the risk. Another note of caution: the return of capital is by no means guaranteed, and the level of income is not fixed.
- Fixed-Term Bonds and Certificates. Fixed-Term Bonds provide for a fixed term investment lasting, usually, up to five years. Unlike the Corporate Bond Funds, the return on capital is guaranteed at the end of the term. The return on the investment is also paid gross and fixed throughout the whole term.
- Set-Term Investments. Non-Taxpayers looking to invest should keep their eyes open for these investments which link the return of capital to a couple of stock market indexes, or even just a basket of shares. In this type of investment for non-taxpayers, the return is paid gross.
- Low-risk Investments on Small Amounts. As the name says, these low-risk investments are only good if you want to invest small amounts of money. In addition, the rates for these investments are not very competitive, so that may be another deterrent. However, keep in mind these investments are low-risk, so you balance things out that way.
- Offshore with Profit Bonds. These kinds of bonds generally do not involve a tax. However, there are charges involved in the investment, and there are penalties for encashment in the first five years of the investment. This is the one on the list that has more drawbacks than the others.