An individual who is about to retire and wants to earn interest without risking principal would most likely be advised to invest in:

An individual who is about to retire and wants to earn interest without risking principal would most likely be advised to invest in:

• A. U.S. Treasury Bonds
• B. Common stock
• C. High-yield bonds
• D. Growth funds

Answer: (A)

For someone nearing retirement who wants to earn interest while keeping the principal safe, U.S. Treasury Bonds are the best fit. They’re issued by the U.S. government and carry virtually no credit risk, so the principal is preserved if held to maturity. They also provide fixed, predictable interest payments, which helps with budgeting in retirement. Other options carry more risk. Common stock represents ownership in a company and can swing in value, potentially reducing principal. High-yield bonds offer higher interest but come with greater risk of default. Growth funds focus on capital gains and can be volatile, not ideal when preserving wealth is the priority.

For someone nearing retirement who wants to earn interest while keeping the principal safe, U.S. Treasury Bonds are the best fit. They’re issued by the U.S. government and carry virtually no credit risk, so the principal is preserved if held to maturity. They also provide fixed, predictable interest payments, which helps with budgeting in retirement.

Other options carry more risk. Common stock represents ownership in a company and can swing in value, potentially reducing principal. High-yield bonds offer higher interest but come with greater risk of default. Growth funds focus on capital gains and can be volatile, not ideal when preserving wealth is the priority.