Buy a money market mutual fund and you won’t lose any money. But you also won’t earn much, either—and you may even forfeit purchasing power over time. Since the end of the Great Recession, money market fund yields have been stuck well below the rate of inflation. You could try bonds, of course. Bonds funds offer higher yields, yes, but then you get more risk, too.
What’s a risk-averse retirement investor to do? Perhaps turn to stable value funds, a potential goldilocks solution that may already be available in your workplace retirement plan.
