To me, there's a distinction between savings and investments. With savings, your primary concern is safety of principal. With investments, you're looking to build wealth to help you meet your future life goals such as owning a restaurant.
When you dial down the risk in your portfolio, you protect the principal against loss, but you take on another type of risk -- purchasing power risk. To build wealth, your portfolio has to earn more than the inflation rate. If it doesn't, what your money can buy 14 years from now is diminished by price inflation.
One way to increase the yield in your savings is to put those savings into certificates of deposit, or CDs, that mature on a longer time horizon. You'll pay an early-withdrawal penalty if you have to take the money out of the CD, so you either accept that risk or keep some of your savings liquid and just put part of your savings in CDs.
Investors with 14-year investment horizons have some rebuilding years ahead of them if their investments take a hit. Don't let stock market gyrations scare you away from having some money in the market. Find a financial planning professional you trust to help you with your asset allocations.
By the way, owning a restaurant is one of the riskier financial decisions you can make. A landmark academic research study, "Why restaurants fail," found that about 1 in 4 restaurants close or change ownership within their first year of business. Over a three-year horizon, that number increases to 3 in 5. You have some time to figure out what is going to make your restaurant beat the odds.
Ask the adviserTo ask a question of Dr. Don, go to the "Ask the Experts" page and select one of these topics: "Financing a home," "Saving & Investing" or "Money." Read more Dr. Don columns for additional personal finance advice.