Guides

Best High-Yield Investments for Every Risk Level

Posted

August 11, 2025

Want better returns without losing sleep? This guide breaks down high-yield investments by risk level—so you can grow your money with confidence.

Building an investment portfolio is a lot like building a house. You need a solid, reliable foundation to keep everything secure—these are your low-risk assets. Then you build the main structure, the parts that will make up the core of your wealth—your medium-risk investments. Finally, you might add some high-performance features that offer incredible benefits but require more specialized attention. The goal of this entire project is to create a high-yield investment portfolio that is both strong and valuable. This guide serves as your blueprint, walking you through each stage of construction, from understanding the materials to choosing the right assets for your financial home.

Key Takeaways

Define Your “High-Yield”: The best high-yield investment is the one that fits your life. Before you invest, get clear on your financial goals, timeline, and personal comfort with risk to choose assets that help you sleep at night.
Build a Balanced, Strategic Portfolio: Don’t just chase returns; build a resilient portfolio. A smart strategy involves diversifying across different asset types, like property and stocks, and planning for tax efficiency to ensure your money is working as hard as possible for your long-term goals.
Stay Engaged to Protect Your Growth: High-yield investing isn’t a “set it and forget it” activity. Protect your assets by regularly reviewing your portfolio, staying aware of economic shifts like inflation and interest rates, and making sure your strategy continues to align with your financial plan.

What Is a “High-Yield” Investment?

When you hear the term “high-yield,” it’s easy to picture dollar signs, but what does it actually mean? Simply put, high-yield investments are assets that offer the potential for higher returns than safer, more traditional options like a standard savings account. Think of things like certain stocks, bonds, and real estate opportunities. The key word here is potential. These investments aren’t a guaranteed path to riches; they come with a higher level of risk.

The goal is to find an investment that generates a return that outpaces inflation and helps you build wealth more quickly. But before you jump in, it’s crucial to understand the dynamics at play. This starts with getting comfortable with the relationship between risk and reward, figuring out your personal comfort zone, and understanding how the wider economy can affect your portfolio. Getting a handle on these concepts is the first step toward making smart decisions that align with your financial goals.

The Risk-Return Tradeoff

The risk-return tradeoff is one of the most fundamental principles in finance. It’s the simple idea that you can’t get higher returns without being willing to accept a higher possibility of loss. An investment that promises a 15% annual return will inherently be riskier than a government bond that offers 4%. It’s a balancing act. Your job as an investor is to find the sweet spot where the potential reward is worth the risk you’re taking on. Understanding this concept helps you set realistic expectations and build a strategy that fits your life, rather than chasing returns that might keep you up at night.

Find Your Personal Risk Tolerance

Speaking of sleeping at night, let’s talk about you. Your personal risk tolerance is your individual comfort level with the possibility of losing money. Are you someone who would panic if your portfolio dropped 10%, or do you have the stomach to ride out market fluctuations for a potentially bigger payoff down the line? Your answer depends on your financial goals, your timeline, and your personality. Someone saving for a down payment in three years will have a much lower risk tolerance than someone investing for retirement in 30 years. Being honest with yourself about the level of risk you can handle is essential for choosing the right investments.

How Market Conditions Play a Role

Your investments don’t exist in a bubble. Broader economic factors, like interest rates and inflation, have a significant impact on their performance. For example, prolonged inflationary pressures can erode the value of your returns, while changes in interest rates can affect the appeal of bonds and other fixed-income assets. It’s important to pay attention to these trends. The good news is that many markets show resilience. For instance, the high-yield market’s overall quality has improved in recent years, meaning many assets are better positioned to weather economic storms. Staying informed helps you understand the context of your investments and make adjustments when needed.

Low-Risk, High-Yield Investments

When you hear “high-yield,” your mind might jump to risky ventures, but that’s not always the case. Low-risk, high-yield investments are all about finding a sweet spot: growing your money faster than a standard savings account without exposing your hard-earned cash to a lot of market volatility. Think of these as the solid foundation of your investment portfolio. They are perfect for short-term goals—like saving for a house deposit or a wedding—where you can’t afford to lose your principal.

These options prioritize capital preservation, meaning your initial investment is kept as safe as possible. While they won’t deliver the explosive growth you might see from stocks, they provide steady, predictable returns that can help you outpace inflation. For anyone just starting their investment journey or for seasoned investors looking to balance their portfolio, these safer bets provide peace of mind. They prove that you don’t have to endure sleepless nights to see your savings grow. The key is knowing where to look and understanding how each option fits into your financial plan.

High-Yield Savings Accounts

Think of a high-yield savings account as a supercharged version of the traditional savings account you’ve probably had for years. They function in much the same way but are typically offered by online banks that have lower overhead costs, allowing them to pass the savings on to you in the form of better interest rates. This makes them an excellent place to park your emergency fund or save for a short-term goal. Your money stays liquid, meaning you can access it when you need it, all while earning significantly more interest than you would at a brick-and-mortar bank. It’s a simple, effective way to make your money work harder for you without any added risk.

Certificates of Deposit (CDs)

A Certificate of Deposit, or CD, is a savings product that holds a set amount of money for a fixed period, such as six months, one year, or five years. In exchange for leaving your money untouched for the entire term, the bank pays you interest at a fixed rate. This predictability is the main appeal of a CD; you know exactly how much you’ll earn and when. They are a fantastic tool for saving for a future expense with a specific deadline, like a down payment on a home. The trade-off for this guaranteed return is a lack of liquidity—withdrawing your money early usually results in a penalty.

Money Market Accounts

Money market accounts are a bit of a hybrid, blending features of both savings and checking accounts. They are considered a very safe place to store your cash for the short term and typically offer higher interest rates than traditional savings accounts. Many money market accounts come with a debit card or check-writing privileges, giving you easier access to your funds than a CD would. This flexibility makes them a great option for an emergency fund or for holding money you plan to use soon. They are a type of cash investment that offers a competitive return without locking your money away.

Treasury Bonds

For the ultimate in low-risk investing, it’s hard to beat government bonds. In the UK, these are known as gilts. When you buy a gilt, you are essentially lending money to the government, which promises to pay you back, with interest, over a set period. Because they are backed by the full faith and credit of the government, they are considered one of the safest investments on the planet. This makes them a cornerstone for conservative portfolios or for investors who want to preserve capital above all else. You can learn more about the different types of government-backed savings and investments directly from National Savings and Investments (NS&I).

Where to Find Safe Investments:

Finding the right home for your money depends on your goals. For cash-based products like high-yield savings accounts and CDs, online banks often provide the most competitive rates. For tangible assets like property, a specialist firm is your best bet. Here are a few trusted places to start your search:

Portico Invest Property Solutions: For those looking to add property to their portfolio, we offer fully managed, hands-off buy-to-let opportunities that provide a tangible asset and steady rental income.
Marcus by Goldman Sachs: A popular online bank known for its competitive high-yield savings accounts and no-penalty CDs.
Ally Bank: Another top online bank offering a full suite of products, including savings accounts, money market accounts, and CDs.
Capital One: A well-known name that offers solid rates on its 360 Performance Savings and CD accounts.
American Express: Primarily known for credit cards, Amex also offers high-yield savings accounts and CDs with no monthly fees.

Best High Yield Investments Right Now

Some of the best high yield investments right now offer strong returns without taking on extreme risk. You can focus on short-term options for quick growth or build a portfolio that pays steady income.

Short-Term High Yield Investments

Short-term investments work well if you want faster results and access to your money. Popular choices include:

High yield savings accounts – Safe, liquid, and earn more than regular savings.
Certificates of Deposit (CDs) – Lock your money for a fixed term and get guaranteed interest.
Money market accounts – Offer decent rates, plus easy access with checks or debit.
Treasury bonds – Government-backed, very secure, and stable.

These options protect your cash while giving better yields than standard accounts. They are practical for beginners or anyone waiting for longer-term opportunities.

High Yield Income Portfolio Strategies

For steady income, many investors build a high yield income portfolio. This blends assets that provide regular cash flow with those that add long-term stability. Examples include:

Dividend-paying stocks – Reliable companies that share profits with investors.
Real Estate Investment Trusts (REITs) – Pay out most of their income as dividends.
Corporate or municipal bonds – Offer higher yields than government bonds with moderate risk.
Property investments – Rental properties or student housing that generate monthly income.

A balanced portfolio can create reliable income while reducing overall risk. By mixing assets, you can aim for growth, stability, and higher yields over time

Medium-Risk Investment Options

If you’re comfortable with a little more uncertainty in exchange for better returns, medium-risk investments could be the right fit for your portfolio. This category strikes a balance between the stability of low-risk assets and the aggressive growth potential of high-risk ones. These options require a bit more homework, but they often form the core of a well-rounded investment strategy, providing both income and capital appreciation.

Finding the right medium-risk investment means looking for assets that have a solid track record but are still subject to market fluctuations. This includes everything from corporate bonds to direct property investments. While they carry more risk than a high-yield savings account, they are generally less volatile than assets like cryptocurrency or growth stocks. For many people, this is the sweet spot where meaningful wealth generation happens without taking on excessive risk. Let’s look at some of the most popular choices.

Corporate and Municipal Bonds

Think of bonds as loans you make to a company or a government entity. Corporate bonds are issued by companies to fund their operations, while municipal bonds are issued by cities or states to pay for public projects like schools and roads. Both tend to offer higher yields than ultra-safe government bonds. While there’s always a chance a company could default on its debt, the high-yield market has shown increased resilience against this risk in recent years. This makes them a solid choice for investors who want a steady income stream with a moderate level of risk.

Dividend-Paying Stocks

Investing in dividend stocks means you’re buying shares in large, established companies that share a portion of their profits with you. These regular cash payments, or dividends, can provide a reliable source of income. These stocks are generally considered safer than other stocks because the companies behind them are typically stable and profitable. While the stock’s value can still go up or down with the market, the consistent dividend payments offer a cushion, making them a popular choice for investors who want a mix of safety and growth potential.

Real Estate Investment Trusts (REITs)

If you want to invest in real estate without the hassle of being a landlord, Real Estate Investment Trusts (REITs) are an excellent option. These companies own or finance income-producing real estate across various sectors, from apartment buildings to shopping centres. By law, REITs must pay out at least 90% of their taxable income to shareholders as dividends, which can create a strong income stream. Investing in a REIT gives you exposure to the property market’s potential for appreciation while also providing liquidity, as shares can be bought and sold easily on the stock market.

Property Investment Opportunities

Directly investing in property is a classic medium-risk strategy that gives you a tangible asset. The goal is to generate monthly rental income and benefit from long-term appreciation in the property’s value.

Buy-to-Let Properties: This involves purchasing a property to rent out to tenants. A successful buy-to-let is one where the rent you collect covers your mortgage and other expenses, leaving you with a monthly profit.
Off-Plan Investments: Buying a property before it’s built can offer significant returns, as you can often purchase it at a discount and benefit from market appreciation during construction. This is a core area where our team at Portico Invest provides expert guidance.
Student Accommodation & HMOs: Properties like student housing or Houses in Multiple Occupation (HMOs) can produce higher rental yields due to consistent demand and multiple tenants, making them an attractive option for diversifying a property portfolio.

High-Risk, High-Reward Investments

If you have a strong stomach for volatility and are aiming for the highest possible returns, this category of investments might catch your eye. These options carry significant risk, including the potential to lose your entire initial investment, but they also offer the chance for substantial growth. Think of these as the sprinters of the investment world—they can be incredibly fast and impressive, but they can also stumble. Because of their speculative nature, most financial advisors suggest dedicating only a small portion of your overall portfolio to these assets. Before you jump in, it’s crucial to do your homework and understand exactly what you’re getting into.

Growth Stocks

Growth stocks are shares in companies that are expected to expand much faster than the overall market. Think of innovative tech companies or businesses breaking into new industries. The excitement here lies in their potential for major price increases as the company succeeds. However, this potential comes with higher volatility. These companies typically reinvest their profits back into the business to fuel more growth instead of paying out dividends to shareholders. This means their stock prices can swing dramatically based on performance and market sentiment. A solid strategy is to be prepared for these price fluctuations and view these stocks as a long-term component of your portfolio.

Emerging Market Funds

Investing in emerging market funds means you’re buying into the growth story of developing countries. These economies can expand at a rapid pace, offering returns that are hard to find in more established markets. The flip side is that these investments are exposed to a unique set of challenges. Political instability, sudden currency devaluations, and economic uncertainty can create a rocky ride for investors. As the FDIC notes, factors like inflation and changing interest rates can also present significant hurdles. This type of investment is best suited for those who can tolerate high risk and have a long time horizon to ride out the inevitable ups and downs.

Peer-to-Peer Lending

Peer-to-peer (P2P) lending allows you to act like a bank, lending money directly to individuals or small businesses through an online platform. In return for taking on this role, you can earn attractive interest rates, often much higher than what you’d get from a traditional savings account. The primary risk here is borrower default—the person you lend to may not be able to pay you back. There’s also platform risk, which is the chance that the P2P company itself could face financial trouble. To manage this, it’s wise to diversify your loans by lending small amounts to a large number of different borrowers rather than putting all your money behind one or two.

Cryptocurrency

Cryptocurrencies like Bitcoin and Ethereum have become famous for their explosive growth potential and headline-making price swings. Early investors have seen incredible returns, but the market is known for its extreme volatility. A digital currency’s value can plummet just as quickly as it can soar. These assets also face an uncertain regulatory future and are susceptible to market manipulation, making them a highly speculative choice. If you decide to invest in crypto, it’s best to approach it with caution. A common rule of thumb is to only invest an amount of money that you would be completely comfortable losing, as there are no guarantees in this digital frontier.

Options Trading

Options trading is a strategy for experienced investors. It involves buying contracts that give you the right—but not the obligation—to buy or sell a stock at a specific price by a certain date. The main appeal is leverage, which allows you to control a large amount of stock with a relatively small amount of capital, creating the potential for outsized returns. However, the risk is equally high. Options contracts have an expiration date, and if your prediction is wrong, you could lose your entire investment very quickly. Success in options requires a systematic approach to risk and a deep understanding of complex market dynamics.

How to Invest Smarter

Growing your wealth isn’t just about picking the right investments; it’s about building a solid strategy that works for you over the long haul. A smart approach can help protect your money, improve your returns, and give you peace of mind. By focusing on a few key principles, you can create a more resilient and effective investment plan. Let’s walk through four essential strategies to help you invest with greater confidence.

Diversify Your Portfolio

You’ve probably heard the saying, “Don’t put all your eggs in one basket.” That’s the core idea behind diversification. It means spreading your money across different types of investments to shield your portfolio from a major loss if one area performs poorly. For property investors, this could mean owning properties in different cities or investing in both buy-to-let and student accommodation. For those with a broader portfolio, it means mixing assets like property, stocks, and bonds. A well-diversified portfolio helps smooth out the inevitable ups and downs of the market, leading to more stable, predictable growth over time.

Allocate Your Assets Wisely

Asset allocation is about deciding how to divide your portfolio among different asset categories. Your strategy should align with your financial goals and timeline. For example, money you’ll need soon for a down payment or an emergency fund should be kept in safer, more accessible places. You might consider using a cash management account or a high-yield savings account for these short-term goals. Money you won’t need for many years can be put into investments with higher growth potential, like property or stocks. This ensures your assets are working effectively for both your immediate needs and your long-term ambitions.

Make Your Investments Tax-Efficient

Taxes can significantly reduce your investment returns if you don’t plan for them. Different investments have different tax rules, and understanding them is key. For instance, with stocks, any dividends are typically taxed in the year you receive them, which can affect your annual income. Property investment comes with its own set of tax considerations, including potential deductions for mortgage interest and operating expenses. By choosing tax-efficient investments and taking advantage of available tax breaks, you can keep more of your hard-earned money working for you, which makes a huge difference in your long-term wealth.

Manage Your Investment Risk

Every investment carries some level of risk, and managing it starts with understanding your personal comfort level. Your risk tolerance is about how you feel when your investments fluctuate in value. Are you comfortable with potential big swings for a chance at higher returns, or do you prefer a slower, steadier path? Beyond your personal feelings, it’s also important to be aware of broader economic conditions like interest rates and inflation, as these can impact all investments. Acknowledging both personal and market risks allows you to build a portfolio that you can stick with, even when things get bumpy.

How to Protect Your High-Yield Investments

Chasing higher returns often means accepting more risk, but that doesn’t mean you have to leave your investments unprotected. Being a smart investor is about balancing growth with security. By understanding the potential risks and taking proactive steps, you can safeguard your portfolio and build wealth with confidence. Think of it as building a strong foundation before putting up the walls. A few key practices can make a significant difference in protecting your hard-earned money while it works for you.

What Is FDIC Insurance?

For cash-based investments like high-yield savings accounts and CDs, your first line of defense is the Federal Deposit Insurance Corporation (FDIC). If you have money in an insured bank, FDIC insurance protects your deposits up to $250,000 per depositor, for each account ownership category, in the event the bank fails. It’s an automatic safety net for your cash. Keep in mind, this coverage doesn’t apply to investment products like stocks, bonds, or real estate. Those assets have different risk profiles and require other protection strategies.

Analyze the Market

Staying informed about market conditions helps you make smarter decisions. You don’t need to be an economist, but having a general sense of the current climate is crucial. For example, the credit quality within the high-yield bond market can shift. Recent analysis suggests the market’s ratings mix has improved, indicating a greater resilience against default risk than in previous years. Understanding these trends allows you to assess whether the potential rewards of an investment still justify the risks involved.

Consider How Interest Rates Affect Value

Interest rates have a ripple effect across the entire economy, and your investments are no exception. When central banks raise rates to manage inflation, it can make borrowing more expensive and potentially cool down economic activity. According to the FDIC, these higher interest rates can challenge economic conditions and introduce new risks. For investors, this can affect the value of existing assets, particularly fixed-income investments like bonds. Staying aware of interest rate trends helps you anticipate potential changes in your portfolio’s value.

Account for Inflation

A high return on paper doesn’t mean much if inflation is eating away at your purchasing power. Inflation is the rate at which the general level of prices for goods and services is rising, and subsequently, the value of currency is falling. The Global Risks Report from the World Economic Forum highlights how persistent inflation can erode gains. Your goal should be to achieve a positive “real return”—that is, a return that outpaces the rate of inflation. This is why assets like property can be attractive, as rental income and property values often rise alongside inflation.

Monitor Your Portfolio Regularly

Finally, protecting your investments requires ongoing attention. Your financial situation, goals, and risk tolerance can change over time, and so can the market. A “set it and forget it” approach can be risky. Regularly monitoring your portfolio is essential to ensure your investments remain aligned with your objectives. A quarterly or semi-annual check-in allows you to rebalance if needed and make sure you’re still on track to meet your long-term goals without taking on unintended risk.

How to Build Your High-Yield Portfolio

Building a portfolio that generates strong returns is a bit like putting together a puzzle. Each piece has a specific shape and purpose, and your job is to fit them together to create a complete picture of your financial future. It’s not about finding one magic investment; it’s about strategically combining different assets to match your goals. With a clear plan, you can construct a portfolio that works hard for you, giving you peace of mind and setting you up for success. This isn’t just about numbers on a screen; it’s about creating a pathway to the life you want to live, whether that means early retirement, financial freedom, or leaving a legacy.

The key is to be intentional. Instead of chasing the latest trends or making reactive decisions based on market noise, a structured approach will help you stay focused and confident. By understanding the fundamentals—from the initial capital you need to how you’ll plan for the long haul—you can lay a solid foundation for growth. This process empowers you to take control of your finances and make informed choices that align with your personal vision. It involves a bit of self-reflection to understand your comfort with risk and a bit of research to see what’s out there. Let’s walk through the essential steps to building a high-yield portfolio that feels right for you.

Know the Minimum Investment

Before you can invest, it’s important to know the cost of entry. Every type of investment, from a high-yield savings account to a buy-to-let property, has a different starting point. Some funds or stocks might let you begin with just a few pounds, while real estate requires a more significant upfront deposit. Understanding these minimum investment requirements is the first step in figuring out where you can realistically allocate your capital. This isn’t meant to be a barrier but a guide to help you map out your strategy and decide which opportunities are the right fit for you right now.

Set Realistic Return Expectations

High-yield investments are exciting because of their potential for great returns, but it’s crucial to keep your expectations grounded. The market is always moving, and even the most resilient assets will experience ups and downs. While the high-yield market has a strong track record, remember that past performance doesn’t predict future results. Setting realistic goals helps you stay level-headed during periods of volatility and avoid making emotional decisions. A good advisor can help you understand what to expect from different investments, allowing you to plan with clarity and confidence.

Create a Balanced Investment Mix

You’ve probably heard the saying, “Don’t put all your eggs in one basket,” and it’s a golden rule in investing. Creating a balanced investment mix, or diversification, is your best defense against risk. By spreading your money across different types of assets—like stocks, bonds, and property—you can protect your portfolio from a major hit if one sector underperforms. In fact, financial experts agree that diversifying across various sectors is a vital way to manage risk in any economic climate. A well-rounded portfolio might include a mix of high-growth stocks alongside a stable, income-generating asset like a buy-to-let property.

Plan for Long-Term Growth

While it’s tempting to look for quick wins, the most successful investors are often those who play the long game. Building wealth takes time, and a long-term perspective allows you to ride out short-term market noise and benefit from compounding growth. Focusing on long-term growth strategies helps you make strategic decisions that will pay off for years to come. Investments like off-plan properties are perfect for this approach, as they are designed to appreciate in value while generating rental income. At Portico Invest, we specialize in helping investors find these kinds of hands-off opportunities that support sustainable, long-term financial growth.

Frequently Asked Questions

Does ‘high-yield’ just mean ‘high-risk’? Not necessarily. While it’s true that investments with the potential for higher returns often come with more risk, they aren’t the same thing. Think of “high-yield” as a broad category that includes everything from relatively safe corporate bonds to more speculative growth stocks. Your job is to find the options within that category that match the level of risk you’re personally comfortable with. A balanced portfolio often includes a mix, so you can benefit from growth potential without putting all your capital on the line.

How much money do I actually need to start with high-yield investing? This is one of the most common questions, and the honest answer is: it depends entirely on the investment. You can start investing in things like dividend stocks or REITs with a relatively small amount of money. However, for a tangible asset like a buy-to-let property, you will need a more significant sum for the deposit and associated costs. The first step is to look at your own finances and decide what you can realistically set aside, which will help you determine which investment opportunities are the right fit for you right now.

Where does a buy-to-let property fit into a high-yield portfolio? A buy-to-let property is a classic medium-risk investment that can be a fantastic anchor for a portfolio. It offers a powerful combination of benefits: a steady, predictable income stream from monthly rent and the potential for long-term growth as the property’s value appreciates. Unlike stocks, it’s a tangible asset you own. This combination of regular income and capital growth makes it a popular strategy for building wealth over time without the extreme volatility of higher-risk assets.

How can I figure out my personal risk tolerance? Finding your risk tolerance is less about a complicated formula and more about being honest with yourself. A simple way to start is to ask yourself two questions. First, what is your timeline? If you need the money in two years for a down payment, your tolerance for risk will be very low. If you’re investing for retirement in 30 years, you can afford to ride out market fluctuations. Second, how would you react emotionally if your investment’s value dropped by 20%? If the thought makes you want to panic-sell, you should stick to lower-risk options.

My savings account interest rate is high, so why should I bother with other investments? It’s great that high-yield savings accounts are offering better rates, and they are the perfect place for your emergency fund and short-term savings. They keep your money safe and accessible. However, for long-term goals like retirement, the interest from a savings account will likely struggle to outpace inflation over many years. To build real, lasting wealth, you need investments with the potential for growth that significantly beats inflation. That’s where assets like property and stocks come in, as they are designed to grow your capital over the long haul.

What is the highest yielding investment right now? Some of the highest yielding options today include growth stocks, emerging market funds, and certain REITs (Real Estate Investment Trusts). Corporate and municipal bonds also provide strong yields with moderate risk.

How do I get 10% interest on my money? Reaching 10% usually means investing in higher-risk assets. Options can include growth stocks, select corporate bonds, or off-plan property investments. These choices can deliver higher returns but come with greater risk. Diversifying with safer assets helps balance your portfolio.

How much money do I need to invest to make $3,000 a month? The amount depends on your yield target. At 6% annual return, you’d need about $600,000. At 8–10%, you’d need less, but the risk is higher. Some investments like REITs or rental property also require larger upfront capital.

How to get 15% return on investment? A 15% return is possible through high-risk, high-reward options such as growth stocks, emerging market funds, or speculative property investments. These can produce strong gains but are volatile. Experts suggest limiting them to a small part of your portfolio.