Cash equivalents
Savings accounts, money market funds and short-term treasury instruments prioritise stability and access. They are the right home for emergency reserves and short-horizon money.
Bonds
A bond is a loan to a government or company that pays interest and returns principal at maturity. Two main risks: the borrower may not pay (credit risk), and bond prices fall when interest rates rise (interest-rate risk).
Longer maturities are more sensitive to rate changes; lower-quality borrowers pay more interest for a reason.
Their role
Stable assets rarely drive long-term growth. Their job is to make the plan survivable — funding needs without forcing you to sell growth assets during a decline.
Why this matters
Having stable money available is what lets you leave long-term money invested.
Terms used in this lesson
- Credit risk
- The risk that a borrower fails to make promised payments.
- Interest-rate risk
- The risk that rising interest rates reduce the market value of existing bonds.
- Maturity
- The date a bond repays its principal.
- Written by
- Suggested Investments Research Team
- Content type
- Educational article
- Published
- 2026-09-13
- Last reviewed
- 2026-09-13
Sources and methodology
- Intelligent Accumulation methodology — Suggested InvestmentsPrimary source
Educational content only. This lesson is not investment, tax or legal advice and does not recommend buying or selling any specific investment. All investing involves the risk of loss.