10 Best Investments for 2025
Written by
Daria Uhlig
Edited by
Elizabeth Constantineau
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Trying to pick one winning investment in 2025 is nearly impossible — no one can predict exactly how the markets will play out. A smarter move is to spread your money across different options that balance income, safety and growth potential. Here are 10 of the best investments for 2025, ranked from lower-risk to higher-risk, to help you find the right fit for your portfolio.
1. High-Yield Savings Accounts
A high-yield savings account pays higher-than-average interest rates, so your money grows faster than it would in a traditional savings account paying average rates.
Why We Like Them
In 2025, you can find accounts paying 4% or more, even though the Fed has already begun to cut interest rates.
That’s a pretty high yield for an insured savings account, considering that the average savings account rate is just 0.40% as of Sept. 15, 2025, according to the FDIC.
Where To Open
- Bank — traditional or online
- Financial technology platforms such as Cash App
- Credit union
Pros and Cons
| Pros | Cons |
|---|---|
| No chance of losing your principal up to FDIC insurance limits | Lower returns than other investments |
| Generous rates compared to standard savings accounts | Might have monthly fees |
| Withdraw funds whenever you want |
What To Watch Out For
- Savings accounts lose purchasing power due to inflation. The inflation rate was 2.9% as of August, per Bureau of Labor Statistics data, so your yields need to outpace that.
- Returns are lower than stocks or bonds, so they’re best for safety, not growth.
2. Money Market Accounts
Money market accounts have higher yields than the average savings account — in 2025, the average is 0.59% compared to 0.40% for standard savings. And they also typically offer check writing and/or debit card access.
Why We Like Them
Money market accounts are a good way to earn a higher yield on your idle cash while still offering you the ability to occasionally write a check.
Where To Open
- Bank — traditional or online
- Credit union
Pros and Cons
| Pros | Cons |
|---|---|
| No risk to principal, up to FDIC insurance limits | Often have high minimum opening deposit |
| Easy access to funds | May have monthly fees |
| Better rates than standard savings or checking accounts |
What To Watch Out For
- High minimum opening or maintenance balance requirements — often $2,500 or more
- May restrict the number of checks you can write every month
3. Certificates of Deposit (CDs)
CDs are a specialized type of bank savings account that is insured by the FDIC. These accounts make regular interest payments until the investor’s principal investment is returned at maturity.
Why We Like Them
CDs are a safe way to earn interest on your idle cash. Maturities range from a few months to 10 years or even longer. The rate you earn is guaranteed for the life of the CD — a clear benefit in late 2025, as rates are starting to fall.
Where To Open
- Bank — traditional or online
- Credit union
Pros and Cons
| Pros | Cons |
|---|---|
| Potentially high rates with high-yield CDs and CD specials | Often have high minimum opening deposits of $500 or more |
| Guaranteed rate | Little growth opportunity |
| As safe as savings and money market accounts |
What To Watch Out For
- Early withdrawal penalties
- Rates can be lower and possibly below the rate of inflation
4. Treasury Bonds
Treasury bonds are a type of security issued by the Treasury Dept. to raise money for government operations and other spending. When you buy one, you essentially make a 20- or 30-year loan, depending on the maturity date, to the federal government. In return, you receive a fixed rate of interest every six months until the bond matures.
Here’s a look at current bond rates issued on Sept. 30, according to Treasury Direct:
- 20-year bond: 4.87%
- 30-year bond: 4.75%
Why We Like Them
Treasury bonds are essentially risk-free because they’re backed by the federal government. And despite the long maturities, they’re liquid investments because they’re in high demand and trade on the open (secondary) bond market.
How To Buy
- Open account on TreasuryDirect.gov.
- Select the “Buy Direct” tab.
- Follow the prompts and enter the purchase amount.
- Hold the bond for at least 45 days before selling.
Pros and Cons
| Pros | Cons |
|---|---|
| Very safe | Low growth |
| Invest as little as $100 | Subject to interest rate and inflation risk |
| Can sell on the secondary market before maturity |
What To Watch Out For
- Can be subject to inflation and interest rate risk
- When you buy or sell bonds on the open market, the price may differ from face value — which can sometimes work in your favor.
5. Corporate Bonds
A corporate bond is like an IOU. Companies issue them to generate cash that they can use for a variety of purposes.
By purchasing bonds, investors essentially loan the company money in exchange for the company’s obligation to pay the investors interest on their principal and, in most cases, pay back the principal when the bond matures.
Investing in a bond fund is less risky than investing in individual bonds of the same type because funds have built-in diversity — a small number of companies in a fund might default, but it’s unlikely that all will.
Why We Like Them
Corporate bonds provide a modest amount of income in exchange for the security of getting your money back at maturity. The Moody’s Seasoned AAA Corporate Bond Yield index stood at 5.35% as of August.
In recent weeks, yields have actually risen on corporate bonds. If the fulcrum tilts the other way, investors can benefit from both higher income and potential capital gains — although that would require a sale before maturity.
How To Buy Corporate Bonds
- Open and fund a brokerage account, preferably at a discount brokerage such as Fidelity or Schwab.
- Research bonds and bond funds.
- Purchase bonds/funds using the “buy” or “trade” button on the brokerage site.
Pros and Cons
| Pros | Cons |
|---|---|
| Relatively safe | Low returns |
| Available funds for better diversification | Subject to inflationary and interest rate risk |
What To Watch Out For
- Bonds come with inflationary risk that can erode their purchasing power.
- They also have interest rate risk — the risk that rates will increase while your money is tied up in the bond.
- Some bonds allow the company to call them back before the maturity date, which might cause you to miss out on the rate you expected to earn on your investment.
6. Dividend Stocks
Dividend stocks return a portion of earnings to shareholders, so you earn income whether or not the share price goes up. Dividend Aristocrats are a special group of companies that have raised their dividends for at least 25 years in a row.
Why We Like Them
In times of economic uncertainty, companies that pay high dividends tend to hold up better. To pay a high dividend, a company needs a consistent revenue stream, and these are the types of businesses that investors value when the economy slows.
How To Buy
- Open and fund an online brokerage account.
- Use the brokerage’s stock screening tools to search for dividend stocks.
- Research individual stocks and funds.
- Purchase them by selecting the “buy” or “trade” button on the brokerage site.
Pros and Cons
| Pros | Cons |
|---|---|
| Steady income through dividends, even if the stock price doesn’t rise | Dividend yields can be cut if the company struggles financially |
| Often less volatile than growth stocks | Dividend income is taxable |
What To Watch Out For
- Don’t focus only on dividend yield — a high yield can sometimes signal a struggling company.
- Balance dividends with overall growth potential, your goals and your risk tolerance.
7. Index Funds
Index funds are a type of mutual fund or exchange-traded fund (ETF) that follows a specific market index, like the Nasdaq-100 or S&P 500. Instead of trying to beat the market, they’re passively managed — meaning the fund just matches the index’s performance.
Why We Like Them
Index funds are generally very low-cost vehicles. Because most investors, even professional ones, can’t outperform the broad market averages consistently, index funds can be an easy way to earn a good return.
Here’s a look at recent index returns:
- Nasdaq-100 index: Cumulative annualized return of 18.4% over the last 10 years.
- S&P 500 index: Produced stellar average annual returns of 13.10% over the past decade.
How To Invest
- Open and fund a brokerage account.
- Use the brokerage platform’s mutual fund or ETF screener to search and select index funds.
- Click the platform’s “buy” or “trade” button to purchase your funds.
Pros and Cons
| Pros | Cons |
|---|---|
| Solid history of growth | Can see significant short-term losses |
| Better track record than managed funds | Fees, expressed as expense ratio |
| Tracks broad market vs. individual company or market segment | Might have minimum investment |
What To Watch Out For
- Index funds can still lose value in market downturns — for example, the Nasdaq fell 33% in 2022 before rebounding.
- Some funds are more volatile and may require a higher tolerance for risk.
8. Mutual Funds
There are thousands of mutual funds and ETFs, so investors can pick almost any style that fits their goals. These funds usually hold hundreds of different investments in one package, which helps spread out risk. Plus, they’re managed by professionals, so you don’t have to handle the details yourself.
Why We Like Them
Mutual funds and ETFs allow you to own a portfolio of tens, hundreds or even thousands of individual securities in a single purchase. Generally, owning a mutual fund is less risky than betting everything on a single stock or bond.
How To Invest
- Open and fund a brokerage account.
- Use the brokerage platform’s mutual fund or ETF screener to search and select actively managed funds.
- Click the platform’s “buy” or “trade” button to purchase your funds.
Pros and Cons
| Pros | Cons |
|---|---|
| Risk spread across many companies | May have minimum investment |
| Large selection to choose from | Lower average returns compared to index fund |
| Fees, expressed as expense ratio |
What To Watch Out For
- Not all funds are well-diversified — some focus narrowly on a single sector.
- Sector funds — like oil or tech — carry more risk since they don’t include exposure to other parts of the market.
9. Real Estate Investment Trusts (REITs)
REITs use investor funds to buy various types of property, managed by professionals, with the income passing through to shareholders. The law requires REITs to distribute at least 90% of the income generated by their investments back to investors.
Why We Like Them
Publicly traded REITs are easy to buy and sell on exchanges, making them highly liquid. They also tend to pay high dividends and are often less volatile than the stock market, which can provide a cushion in tough market years.
Falling interest rates can also boost REIT prices. The Federal Reserve has already lowered rates once in 2025, and many experts expect another cut before the year’s end.
How To Invest
- Open and fund a brokerage account.
- Open the brokerage’s stock screener and select REIT as the security type.
- Research REITS listed in the screener.
- Click the platform’s “buy” or “trade” button to purchase.
Pros and Cons
| Pros | Cons |
|---|---|
| Efficient way to invest in real estate | Dividends taxed according to income tax rate vs. the usually favorable capital gains tax rate |
| Good liquidity | Vulnerable to interest rate fluctuation |
| Can hedge against stock volatility |
What To Watch Out For
- Nontraded REITs — not listed on public exchanges — and private REITs are riskier, less liquid and often come with higher fees than publicly traded REITs.
- Be especially cautious with private REITs, since they are not regulated by the Securities and Exchange Commission (SEC).
10. Individual Stocks
Individual equities are an exciting way to potentially generate capital gains for your account. Many investors enjoy owning shares of companies they are familiar with and use in daily life.
Why We Like Them
Stocks generally have a higher long-term average return than most other investments. They’re also a good hedge against inflation. If you pick the right stocks, you can earn long-term, outsized gains.
Market darling Nvidia, for example, has posted a staggering total return of over 1,288% over the past five years. For context, this is over 12x the S&P 500’s 101.42% total return over the same period.
How To Invest
- Open and fund a brokerage account.
- Open the brokerage’s stock screener and use the filters to narrow your choices.
- Research the companies listed in the screener.
- Click the platform’s “buy” or “trade” button to purchase your shares.
Pros and Cons
| Pros | Cons |
|---|---|
| Potential for outstanding growth | High risk |
| Over 5,000 companies to choose from | Many forces, external and internal, can affect prices |
| Opportunity to invest in specific companies you like or believe in |
What To Watch Out For
- Stocks are naturally volatile — companies like Nvidia can post huge gains but also carry big risks.
- Unlike broad market indexes, many individual stocks never recover from downturns, and some go bankrupt.
Best Investments for 2025: At a Glance
Here’s a quick look at the top investment options, their risk levels, returns and who they’re best suited for:
| Investment Type | Risk Level | Average Returns | Liquidity | Best For |
|---|---|---|---|---|
| High-yield savings accounts | Low | 3.5% to 4.5% | High | Short-term savings |
| Money market accounts | Low | 3.5% to 4.5% | High | Short-term savings when check writing is needed |
| CDs | Low | 3.5% to 5% | High | Short- or medium-term savings |
| Treasury bonds | Low | 4.75% to 4.87% | High | Long-term fixed income |
| Corporate bonds | Medium | 4% to 5.5% (over 10 years) | Varies | Capital preservation |
| Dividend stocks | Medium | 11.57% (10-year annualized) | High | Income investing |
| Index funds | Medium | 13% to 18% | High | Broad market exposure |
| Mutual funds | Medium | 8% (20-year average) | High | Exposure to specific market segments |
| Real estate investment trusts (REITS) | Medium | 5.09% (20-year average) | High | Hedge against stock volatility |
| Individual stocks | Medium-high | 13% (10-year average) | High | Growth and/or income investing |
The Best Investing Strategies To Use Right Now
Picking the best investments is only half the equation. Using the right strategy is just as important. Here are three popular strategies to consider.
Dollar-Cost Averaging
With dollar-cost averaging, you invest the same amount at regular intervals. This lowers your average cost per share over time and helps protect against price swings.
Buy-and-Hold Investing
One proven strategy is Warren Buffett’s favorite: purchase stocks with the intention of holding them for years.
Dividend Reinvestment
Dividend reinvestment works the same way as compound interest. If you don’t rely on your investment dividends to cover your living expenses, reinvesting them can significantly increase your returns over time.
Pro Tip
Set your brokerage account to buy your chosen investments on a regular schedule and reinvest dividends for you.
Expert Insights
Earlier this quarter, Merrill highlighted both “bright spots” and “warning signs” for the markets and the economy. In a video on Merrill’s website, Chris Hyzy, chief investment officer for Merrill and Bank of America Private Bank, and Brian Daley, senior portfolio manager for the Chief Investment Office, broke down the areas of strength and potential risks.
Bright Spots
- Infrastructure
- Domestic manufacturing
- Tech
- AI supply chain
- Transportation
- Defense
- Utilities
Warning Signs
Merrill cautioned that energy and certain other sectors that are vulnerable to challenges like ongoing inflation, geopolitical tensions could face ongoing headwinds.
Investing Key Terms
- APY: The yearly rate of return on your money, including the effects of compounding.
- CD: A type of deposit account that earns a fixed rate of interest for funds you agree to leave in the account until it matures.
- Dividend Aristocrat: Companies that have increased dividends every year for at least 25 years.
- ETF: Exchange-traded fund, which trades like a stock but otherwise is similar to an index or actively managed mutual fund.
- REIT: Real estate investment trust, which is a company that owns, operates, manages and/or finances commercial or multifamily real estate.
Final Take
The best investments for 2025 — and the best investing strategies — help you maximize your returns while managing risk, even in volatile markets.
Follow these tips to give yourself the best chance for success:
- Review your asset allocation to make sure your portfolio has a mix you’re comfortable with.
- Periodically rebalance your portfolio by replacing assets you have too much of with assets that will get your allocation back into sync.
- Be wary of fees, especially if you’re investing in funds.
FAQ: What Investors Want To Know in 2025
Sorting through investment options can be confusing. These quick FAQs break down what you need to know.- What is the safest investment in 2025?
- The safest investment is a high-yield savings account. You can earn an APY that outpaces inflation with no risk to your principal.
- Are CDs safer than bonds?
- CDs are safer than corporate bonds because your principal is safe as long as you don't withdraw your money before the CD matures. CDs and Treasury bonds have about the same degree of safety — Treasuries because they're backed by the full faith and credit of the U.S. government.
- How safe are I-bonds?
- I-bonds are extremely safe because of their federal government backing.
- What's a high-yield savings APY now?
- High-yield savings APYs vary by bank, but some banks are offering over 4.25%.
John Csiszar contributed to the reporting for this article.
Information is accurate as of Sept 28, 2025.
Our in-house research team and on-site financial experts work together to create content that’s accurate, impartial, and up to date. We fact-check every single statistic, quote and fact using trusted primary resources to make sure the information we provide is correct. You can learn more about GOBankingRates’ processes and standards in our editorial policy.
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