2012 has been a tough year for people around the world. With the European debt crisis and high unemployment rates in the U.S., it is hard to decide where to invest to keep your money safe and to earn some interest without getting yourself into financial trouble. It is a fact that in order to make money from your investments, you might have to take some risks. But in uncertain times it is best to keep your risk profile to a minimum. Saving cash in the bank may be safe but it is also a definite loser as the average inflation rate is higher than the interest paid, so your money is almost guaranteed be worth less by the end of the year (even counting the added interest) so you will literally be losing money by just putting it in the bank.
If you are optimistic that the inflation rate will stay low in 2013, a savings account might be one of your safest options. It also very important to keep enough in the bank to cover at least six months of living expenses if you are planning on investing in stocks or any shares that may come at a risk, to ensure your own financial stability.
How you are going to invest in 2012 and 2013 will depend entirely on your own risk tolerance as well as your personal investment goals. Other Options include:
 Bonds
In an economic climate of deflation and slow growth, bonds could prove to be your safe haven. Although bonds are more sensitive to interest rates than cash, bond prices could fall as the economy recovers and starts growing again, if interest rates start rising. Holding bonds to maturity will protect your principle and lock in a set interest rate. Intermediate term bonds may be the best middle road to take, as short-term bonds could perform exactly like cash and won’t earn you much in 2012, while long-term bonds could lock you in to a low rate with a declining principle for too long. Do some research before choosing a specific bond.
See: What are High Yield Bonds?, Invest in Structured Bonds?, A Student’s Guide To Investing in Bonds, Corporate Bonds
Safe Consumables
If you want to invest in shares on the stock market in 2012, go for companies that trade in consumables that will always remain popular. Consumers will always try to buy the best their money can buy, so small luxury items remain in demand in 2012. Staple consumables such as bread, toothpaste and laundry detergents are items that will be purchased whether times are good or bad, so the equities of these producers are always an attractive option.
Among consumable retailers, you may consider companies such as dollar stores, discounters and those that trade with used merchandise. In a bad economy, these are guaranteed to do well as more and more people shop for cheaper goods.
Health Care Providers
Shares of providers of medical services will remain in demand in 2012, as these are not influenced much by the economy. There will always be sick people that need to be treated and healthcare will always be in demand. Browse websites to see which stocks are the most attractive and will give you the best returns.
 Real Estate Property
Property is often seen as a solid investment, due to the fact that it will also always remain in demand. During a recession, you will see an increase in foreclosures, so property prices usually come down drastically as people need to urgently sell to cover their debts. If you have enough cash to buy a distressed property, this could turn out to be a really good investment. It will not only generate money from rental income, but also give you back more than you paid for it if you sell it after the economy improves.
During the economic crunch, you will typically see demand for rental property, as victims of foreclosure can’t buy again but still need a place to live. A lot of people are also downsizing in an effort to cut down on living expenses.
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