Definition

Fixed Income refers to investments that provide steady and predictable payments, typically in the form of interest or dividends. It is usually a low-risk investment option ideal for stability and consistent cash flow.

Analogy

Fixed income is like planting a fruit tree. Once it’s grown, it gives you a steady supply of fruit every season. You know what to expect, and while it won’t grow dramatically like a wildflower (stocks), it provides reliable and consistent benefits over time.

Little-Known Fact

As of 2023, the global bond (a type of fixed-income) market was valued at approximately $140.7 trillion, surpassing the global stock market, which stood at around $115 trillion*. While stocks often dominate public conversation, bonds quietly form the backbone of the financial system, providing stability to economies and investors alike.

Action Step

Review your current investments. What percentage is in fixed income?