My parents are retired (71 and 75), their house is paid off, and they have a moderate amount of savings between some IRAs and bank accounts. All of their savings is in cash or money markets, and it has been that way for awhile.

They recently asked me to help them out with managing their money. My initial reaction is to not change anything given their age. I had thought about putting some portion of their savings into a bond ETF, but you hear talk in the news about a current "bond bubble" so I'm thinking even that might be too risky of an investment for them.

Is it reasonable for a couple in their situation to keep all of their money in cash? Or is there some other safe strategy we should consider for their investments?

  • 5
    You really should not be seeking advice of this matter here, we know nothing about you or your parents, their risk profile, the amount of funds they have or how much money they need to live off each year. You should be seeking advice from a Financial Planner.
    – Victor
    Jan 18, 2016 at 11:50
  • I'm not looking for advice specific to their exact situation, but rather I was hoping there were some known strategies for very low risk investing at that stage of life.
    – minou
    Jan 18, 2016 at 18:33
  • I can't help but wonder how this ended up on Hot Network Questions with such a low number of views and upvotes, and a single answer that essentially says "don't ask this here." Jan 18, 2016 at 22:12

3 Answers 3


The safest investment in the United States is Treasures. The Federal Reserve just increased the short term rate for the first time in about seven years. But the banks are under no obligation to increase the rate they pay. So you (or rather they) can loan money directly to the United States Government by buying Bills, Notes, or Bonds. To do this you set up an account with Treasury Direct. You print off a form (available at the website) and take the filled out form to the bank. At the bank their identity and citizenship will be verified and the bank will complete the form. The form is then mailed into Treasury Direct.

There are at least two investments you can make at Treasury Direct that guarantee a rate of return better than the inflation rate. They are I-series bonds and Treasury Inflation Protected Securities (TIPS). Personally, I prefer the I-series bonds to TIPS.

Here is a link to the Treasury Direct website for information on I-series bonds. this link takes you to information on TIPS.

Edit: To the best of my understanding, the Federal Reserve has no ability to set the rate for notes and bonds. It is my understanding that they can only directly control the overnight rate. Which is the rate the banks get for parking their money with the Fed overnight. I believe that the rates for longer term instruments are set by the market and are not mandated by the Fed (or anyone else in government). It is only by indirect influence that the Fed tries to change long term rates.

  • +1, but to your first line -,"short term treasuries", as I suspect a 30 yr bond has far more risk than reward ahead. Jan 19, 2016 at 13:31
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    also, even if the yields are higher than inflation, there is significant risk that the face value could fall if interest rates increase, reducing the effective yield
    – JAGAnalyst
    Jan 19, 2016 at 19:54

You need to have them consult with a financial adviser that has a focus on issues for seniors. This is because they are beyond the saving for retirement phase and are now in the making-their-money-last phase.

They also have issues related to health insurance, IRA RMDs, long term care insurance. The adviser will need to review what they have and determine how to make sure it is what they need.

It is great idea for you to go along with them so you can understand what needs to be done.

You will want an adviser that charges you a fee for making the plan, not one that makes a commission based on what products you buy or invest in.


After retirement nobody want to get low on cash. So, the best way to stay safe is to make some investments. Compare the saving with regular expenses and invest the rest. You can put some money in short-term reserves such as bank accounts, market funds, and deposit certificates. You will not be able to make much money on it but, it will ensure the financing of at least two to three years. There’s no need to take the money out from stocks but, if the stocks are doing good and there is a possibility that there will be no further profits then you can think of taking them out otherwise leave it alone.

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