Best Savings Investments: Secure your assets

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Managing your savings is a fundamental pillar of your financial strategy. Whether you want to build up a security reserve, prepare for retirement or grow your capital, choosing the best savings investments is essential. Your choice will depend on your financial objectives, your investment horizon and your risk tolerance. So it's important to be well-informed and supported in your decision-making.

A savings investment consists of investing a sum of money in financial products with the aim of making it grow. Depending on the type of investment chosen, returns and associated risks vary. Secure investments generally offer a more modest return, but with limited risk, while dynamic investments can offer more attractive returns, in return for greater exposure to risk. Understanding these differences is essential if you are to make the right choice for your short-, medium- or long-term objectives.

Savings play a central role in building and managing sustainable wealth. It provides a solid foundation for coping with the unexpected, financing projects and preparing for the future. Different types of savings, such as precautionary savings, retirement savings or savings for specific projects, each contribute to a different aspect of wealth management. This diversification offer enables you to strategically allocate your resources to meet your current and future needs, while optimizing your capital.

Several solutions are available for investing in savings products, including European savings investments, each with its own specific features. Here's an overview of the main types of investment.

Savings passbooks

Passbook savings accounts, such as the Livret A, are the most accessible and secure investments. They offer total liquidity and a guaranteed interest rate. However, the return is often lower than inflation, which means that invested savings can lose value in real terms over the long term. Passbooks are popular investments for precautionary savings, but not recommended for growing your capital.

Term accounts

Term accounts offer a higher rate of interest than savings books, but the money is locked in for a set period. This investment is suitable if you're sure you won't need to access your money before the end of the term. On the other hand, if you urgently need cash, this investment could become restrictive.

Life insurance

Life insurance is one of the most popular savings vehicles in France. It allows you to invest in a wide range of products, including secure euro funds and unit-linked products, which are riskier but offer higher potential returns. Life insurance has the advantage of being tax-efficient after 8 years of ownership, while offering a high degree of flexibility. However, unit-linked products carry a risk of capital loss.

Share Savings Plan (PEA)

The PEA is a tax-advantaged savings product for investing in equities, subject to certain conditions. It is an attractive option for investors wishing to diversify into stock markets and benefit from the growth of French and European companies. However, the PEA does entail risks, notably due to fluctuations in the financial markets. The value of the investment can therefore vary, sometimes significantly.

Retirement Savings Plan (PER)

Retirement savings are a strategic lever for anticipating the decline in income after working life. Retirement Savings Plans (PER) offer attractive tax advantages, notably the deduction of payments from taxable income, in return for the funds being tied up until retirement, with certain exceptions. They enable you to build up capital or an annuity available at retirement. However, PERs entail risks linked to financial market trends and the management of invested funds.

SCPI

SCPIs (Sociétés Civiles de Placement Immobilier) enable you to invest in property without having to manage the assets directly. They offer attractive returns in the form of rental income, but also present real estate-related risks, notably vacancies or falling asset values. SCPIs are often used to diversify a savings portfolio, but they require a long-term commitment, as liquidity is limited.

Private equity

Private equity represents an attractive savings alternative for investors seeking high returns, in particular by supporting unlisted companies such as start-ups or developing SMEs. This long-term investment allows you to diversify your portfolio by investing in innovative sectors with high growth potential. However, it does entail notable risks, such as limited liquidity and the possibility of capital loss. This option is therefore suited to investors prepared to accept a long investment horizon and manage a higher level of risk.

Eurazeo Wealth Solutions offers Private Equity solutions through dedicated funds, enabling individuals to invest in high-potential sectors.

Crowdfunding

Crowdfunding makes it possible to invest in specific projects via online platforms, whether in real estate, startups or other sectors. It's a way of supporting initiatives while hoping for a financial return. However, the risk is high, as these investments are often illiquid and can be affected by project failure.

Regardless of the type of investment chosen, each option carries risks linked to profitability, liquidity or market fluctuations. It's essential to understand these risks and adapt your investment strategy accordingly.

The choice of investment depends on a number of factors that are specific to your financial objectives.

Defining your financial objectives

Before choosing an investment, it's crucial to clearly define your objectives. Are you looking to save for a short-term project or for retirement? Taking the time to clarify your objectives will help you select the investments best suited to your situation and future needs.

Investment horizon

Your investment horizon plays a key role in your choice of investments. Short-term investments generally favor security and liquidity, while long-term investments may allow for greater risk-taking to aim for potentially higher returns.

Risk tolerance

Risk tolerance determines your ability to withstand fluctuations in the value of your investments. A good assessment of this tolerance enables you to make more informed investment choices in line with your expectations.

It's important to understand that all investments carry risk. Even so-called safe investments can be affected by inflation or changes in tax legislation. Here are the main risks to consider:

• Risk of Capital Loss: Some investments may result in a loss of your capital, depending on fluctuations in the financial markets.
• Liquidity risk: Some investments do not allow immediate access to your capital, which can be a problem if you need your money before the end of the lock-in period.
• Interest rate risk: Fixed-rate investments can lose value if interest rates rise, making other investments more attractive.
• Credit risk: If the issuer of an investment product runs into financial difficulties, it may not be able to repay the loan, reducing the profitability of your investment.

Optimizing your savings requires careful management and the selection of investments tailored to your financial objectives. Here are a few tips to help you maximize the efficiency of your investments, while taking into account risks and returns.

Diversify your portfolio

Diversification is an effective way of limiting risk while seeking to enhance returns. By spreading your investments across different asset classes, you reduce the impact of fluctuations in a specific market and benefit from the performance of different sectors.

Follow market trends

Tracking economic trends and financial market performance is essential for adjusting your investments in real time. This enables you to seize new opportunities or react to significant market variations, particularly in dynamic sectors.

Tax advantages

Certain investments, such as life insurance and stock savings plans, offer significant tax advantages. These schemes enable you to reduce the tax on the income generated by your investments, or to benefit from tax allowances after a certain holding period. It's important to take these advantages into account to optimize your after-tax returns.

Consult a financial advisor

If you're in any doubt about which investments are best suited to you, consulting a financial advisor may prove useful. A professional can make recommendations based on your investor profile, objectives and risk tolerance.

Technological and societal developments are shaping new investment opportunities for savers. By 2025, savings investments will be undergoing significant innovation, notably with the rise of technology, artificial intelligence and investment automation. These tools enable customized, optimized and transparent portfolio management, better meeting the individual needs of savers. Furthermore, responsible and sustainable investment continues to grow, with financial products incorporating environmental, social and governance (ESG) criteria. Savers are increasingly seeking to combine financial performance with positive impact, notably through green funds and socially responsible investments.

Savings investments entail inherent risks, including loss of capital. Before making any investment decision, it is essential to read the information and legal documentation associated with each product carefully.

This article was produced by Eurazeo Global Investor for information purposes only. It should not be construed as a solicitation or offer for financial products, nor as legal, tax, financial or other advice. Readers are invited to contact their own advisors for any analysis relating to the content of this article. The information presented does not claim to be exhaustive. It should not be relied upon as the sole basis for an investment decision. Please refer to the legal documentation of the funds mentioned before making any final investment decision.

Past performance is not necessarily indicative, nor a guarantee of future results. Information on past investments is provided solely to illustrate the nature of these investments and the related investment strategy and process. There can be no guarantee that the investments made by the funds will yield comparable results, or that the targeted returns will be achieved. Investing in Private Equity/Private Debt funds involves a risk of capital loss and illiquidity.