Most of us know where to invest money in memories, but when it appears like the sky may be falling, knowing where to invest money and how to invest it becomes a puzzle. In 2014 and 2015 good investments might be hard to find, particularly if yesterday’s good investments like stocks and bonds tank. This is not a prediction, but instead a “heads up.” You can’t prepare if you are unaware, so let’s have a closer look at the sky.

We all know that safe choices like money market funds and bank savings accounts don’t appear to be good investments for 2014 since they pay peanuts. But imagine if the sky starts falling: either interest rates ignite and/or the stock market tanks? Either way or both… where you can invest money is the question of the day. Safe choices will look like good investments for parking money that must be safe.

Wall Street’s traditional response to where you can invest money: put about 60% into stocks with about 40% in bonds holding a cash reserve on the sidelines. Problem: in 2014 and 2015 losses in stocks is probably not offset by gains in bonds… as was the case for the last 30 years or so. If interest rates soar from today’s record-low levels, neither stocks nor bonds look like good investments.

Binomo For over 30 years interest rates were falling and bonds were generally good investments. With today’s ridiculously low rates (created by our government to stimulate the economy) a rebound in interest levels is in the cards (as the government unwinds its stimulus). When that happens, bonds won’t be where you can invest money for higher interest income with relative safety. Bonds aren’t good investments when rates rise; they lose money. That’s the way it works. How exactly to invest in bonds in 2014 and 2015 if rates take off: lighten up and choose safety.

Stocks had been very good investments five years running as the year 2014 began. This is at least partly because of government stimulus and cheap money. In a sense, stocks were where to invest money because nothing looked cheap aside from money (short-term interest levels were set at about one-tenth of one percent). With an increase of over 150% in five years, the downside risk in the stock market is mounting. This begs the question of how exactly to invest profit stocks if the sky starts to look ominous.

Remember that the currency markets is truly a market of stocks, which means that almost all stocks get hit once the market crumbles – but at least a few will be good investments. And the ultimate way to find good investments in a bad market would be to watch the purchase price action. For example, as the market climbed 30% in 2013, some gold stocks were down about 50% by early 2014. If you don’t know how to invest in or how to pick a specific gold stock… you should know where to invest money to have a piece of this action. The answer is to invest profit gold funds and let them select the gold stocks for you.

The bottom line is that in 2014 and 2015 investors face an uphill battle, because both stocks and bonds look pricey. That displays a new challenge to today’s investor searching for where to invest money. We are facing uncharted waters in this modern electronic world, where no-one really knows how exactly to invest or how to locate good investments for the future. This consists of the big investors like life insurance companies and pension funds.

My suggestion is to take some profits in your stocks and bonds, as the tide will turn eventually if not in 2014 or 2015. Then you’ll have a cash reserve, to help you take advantage of the situation because the skies darkens. Smart investors are always in search of where you can invest money next, particularly when a big change of trend is in the cards. At such times, yesterday’s underperforming sectors or industries often become today’s good investments.