Are you prepared to take more risk for income?

Q: I have about $80,000 invested in American Funds Money Market Fund-A and CB&T CUST Individual Retirement Account, both in the same Class A fund. They haven't made any money in a long time. Should I hold on to them or consider moving them?

I'm a very conservative senior citizen who can't afford to take chances. I've been using the investment for emergencies, so I don't want to lock it into an annuity

A: Patrick Connolly is a certified financial planner for AWD Chase de Vere

As you have an individual retirement account (IRA) this suggests that you have previously been working in the US and it may be that you're a US citizen. This makes it very difficult to give you any specific guidance.

However, it's clear that you're facing the same problem as many other savers in trying to generate secure returns in a low-interest rate environment.

The dilemma for many savers is whether to accept that while they may not be making an absolute loss with their savings, they are likely to be making a loss after the effects of inflation are considered, or to take more risk in order to try and increase returns on the understanding that they may lose money in absolute terms.

The American Funds Money Market Fund A invests in US Treasury securities and other securities backed by the US government. In the current low interest-rate environment, the return on this fund is very low and is cancelled out by the fund charges.

Indeed, the fund is actually making a loss, but the investment adviser has been giving back some of the charges, so that the return for investors remains at zero.

Since the fund was launched in May 2009, the return has been 0%, and until interest rates rise, it's unlikely this will change significantly.

However, you need to be aware that, as the fund is denominated in US dollars, you are exposed to currency risk, which could increase or decrease your returns.

Whether you should stay in this fund depends on whether you're prepared to accept more risk in order to achieve better returns. Your existing growth prospects are minimal in the short term but your capital is likely to remain quite secure.

If you're prepared to take more risk you could look to diversify into other fixed-interest investments and some shares, with the emphasis on safer investments, but this does mean there is an increased chance that you will lose money.

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