What is the best short-term investment in 2026?

What is a short-term investment?

A short-term investment meets a specific need: having your capital available again within a few months, or within two to three years at most.

We are not talking about a long-term investment that you interrupt along the way; it is a category of its own, designed from the outset for a short duration.

Three criteria matter, and in this order: the safety of the capital, the availability of the money, and only then the return.

Over such a short horizon, taking a market risk to gain an extra percentage point of return generally makes no sense, since time is not on your side to smooth out a possible decline…

In practical terms, this need arises in several situations: precautionary savings that you want to earn a minimum, capital in transit between two projects, or quite simply a dated objective, such as a property purchase in eighteen months.

We deliberately leave the stock market, ETFs and SCPI out of this comparison. Not because they would be bad, but because they do not follow the same logic: their profitability horizon is counted in years, not in months, and a market drop at the wrong time can force you to sell at a loss if you need to recover your capital earlier than expected. And over the short term, these are precisely the vehicles to avoid.

How much should you set aside for this precautionary savings before thinking about the rest? The generally accepted benchmark is between three and six months of fixed expenses: rent or mortgage, bills, food.

It is this amount that must remain in fully liquid products! The rest, the capital whose future use you already know or that you are willing to put to work a little more, can be spread across the other solutions presented below.

Regulated passbook accounts, the basis of precautionary savings

Livret A and LDDS: rate, cap, taxation

The Livret A remains French savers' number one reflex.

Since 1 August 2026, it yields 1.7% net of tax, a rate shared with its twin the LDDS (Livret de développement durable et solidaire). The payment caps differ and amount to €22,950 for the Livret A and €12,000 for the LDDS.

The main advantage of these two passbook accounts comes down to one word: liquidity. You deposit and withdraw whenever you want, with no notice period or penalty, and the interest is exempt from income tax as well as from social security contributions. In plain terms, the stated rate is the rate you actually receive.

Note: a detail many people are unaware of: interest on a regulated passbook account is calculated per calendar fortnight, not day by day. A deposit made on the 20th of the month only starts earning interest from the 1st of the following month. Depositing just before the 1st or the 16th, and withdrawing just after, therefore makes it possible not to lose a single day of remuneration.

The limit is just as simple: beyond the cap, you have to look elsewhere. And at 1.7%, the return barely keeps up with inflation, itself estimated at around 2% over the year 2026 according to Insee...

The LEP, the most remunerative subject to income conditions

The Livret d'épargne populaire is a game changer for low-income households. Its rate, maintained at 2.5% net until 31 January 2027, is clearly higher than that of the Livret A.

The deposit ceiling, on the other hand, is lower, at €10,000, and access depends on the reference tax income: it must not exceed €23,028 for a single person, or €35,326 for a couple without children, on 2026 income.

If you are eligible, opening a LEP even before filling up your Livret A makes sense: it is the highest-paying regulated savings product on the market, with strictly zero risk! On €10,000 invested for a full year, that represents €250 in interest, compared with €170 for the same amount on a Livret A.

Term deposit accounts: a guaranteed rate in exchange for locking up your capital

The term deposit account (CAT) works the opposite way to savings passbooks.

You lock up a sum for a period fixed in advance, from a few months to several years, in exchange for a guaranteed rate known from the outset. The rates observed in 2026 go up to 3.5% depending on the term and the institution, with some neobanks seeking customers with even more generous welcome offers over the first months.

It is a good compromise for a sum whose date of use you already know. However, exiting before maturity is costly: partial or total loss of interest, depending on the terms of the contract.

Another point not to be overlooked: the interest from a CAT is subject to the single flat-rate levy, the well-known flat tax, now set at 31.4% since 1 January 2026 (12.8% income tax and 18.6% social levies).

Let's take a simple example: on €20,000 invested for six months at 3% gross, the gross interest comes to about €300. Once the PFU is applied, about €206 net remains. The headline return must therefore always be read after tax in order to compare the options on an equal footing!

Money market funds: the liquidity of a savings passbook, the return of the market

Less well known to the general public, money market funds invest in very short-term debt securities: Treasury bills, certificates of deposit, commercial paper. Their yield closely tracks the European Central Bank's key rates, reflected in the €STR index, and currently stands in a range of around 3 to 4 % gross depending on the vehicle.

Two advantages set them apart from term deposit accounts: liquidity, usually daily, and possible access through a life insurance policy or a PEA, which can reduce taxation after a few years of holding. Without a tax wrapper, however, it is still the PFU at 31.4 % that applies.

In practice, they are most often accessed through a money market unit-linked fund held within a life insurance policy, or directly through a securities account for savers who prefer to manage their own holdings.

The entry ticket generally remains modest, which makes it an accessible option even to supplement an already full savings account.

A very large sum with no known maturity? Spreading it across several vehicles, full savings accounts, some term deposits, some money market funds, limits the risk of having everything locked up at the wrong time. It is a logic of buckets rather than of a single product.

Participatory lending: a little-known building block to boost precautionary savings

Why the short durations of crowdlending change the picture

The participatory loan, or crowdlending, consists in lending directly to companies through a platform, in exchange for an interest rate set in advance. On platforms such as Maclear, this rate is between 14 and 16% per year depending on the project's risk profile, with a return that can rise to as much as 16.5% thanks to loyalty programmes.

Why mention it in an article about the short term? Because the duration of each loan is set project by project, and displayed even before you invest.

So unlike a traditional term deposit where the bank imposes its own duration tiers, here you know precisely what you are committing to, project after project, and you can build a portfolio aligned with your own horizon by spreading your investments across several maturities. Convenient.

Another major difference from savings accounts and term deposits: interest is paid monthly, as soon as the project is funded, and not capitalised in a single payment at maturity.

For precautionary savings that you want to generate regular income rather than a deferred gain, the argument carries weight and it is also what makes it possible, in practice, to gradually reinvest the interest received rather than waiting for a single payment at the end.

The subject deserves to be explored more broadly: our article on alternative investments details the different families of investments outside traditional banking channels, and where participatory lending stands among them.

The taxation of participatory lending compared with tax-exempt savings accounts

Here, there is no surprise and no hidden advantage: income from participatory lending follows the regime of the prélèvement forfaitaire unique, at 31.4% in 2026, in the same way as a term deposit or a money market fund held outside a tax wrapper. Unlike the Livret A or the LDDS, there is no exemption.

This is an essential point of comparison before choosing between the different options: at an equal headline rate, a taxed investment structurally yields less net than a tax-exempt savings account. The gross return differential between a Livret A at 1.7% and participatory lending at 14-16% nevertheless remains wide enough for the net gap to stay very significant, even after the PFU is applied.

To go further on this specific point, in particular the comparison between the French regime and the Swiss regime depending on your place of residence, head to our article dedicated to crowdlending taxation.

The risks to know before investing

A financed company may run into difficulties and fail to repay all or part of the loan. That is why serious platforms apply a risk scoring before listing a project, and rely on a guarantee fund intended to absorb part of the unpaid amounts.

This mechanism appreciably reduces the risk.

Then, there is liquidity risk : once invested, the money remains committed until the scheduled repayment, unless a secondary market allows the position to be resold to another investor, which is neither automatic nor guaranteed at a given price.

Let's take a concrete example: rather than placing €3,000 on a single project, spreading it in tranches of €300 or €500 across five to ten different projects strongly limits the impact of an isolated default on the overall return of the portfolio. It is the same principle as diversification on the stock market, applied to crowdlending.

How to choose according to your horizon and your profile

Here is a summary to find your way quickly.

For precautionary savings available at any time: Livret A, LDDS, then LEP if you are eligible. For a sum whose date of use you already know: the term deposit account locks in a tailor-made rate. For day-to-day liquidity without the constraints of a lock-up: the money market fund. And to boost part of your savings without aiming for the long term, while accepting a measured share of risk: crowdlending usefully completes the picture.

FAQ

Which short-term investment pays the most in 2026?

Participatory lending shows the highest rates, between 14 and 16% depending on the project. This return remains taxable and carries a risk of capital loss, unlike regulated savings accounts whose return is capped but guaranteed.

Is the Livret A really the best precautionary investment?

Yes, for its immediate availability and zero taxation. Its return of 1.7% remains modest, but no other solution combines as much security and flexibility for savings you may need to withdraw at any time.

Can you lose money with a short-term investment?

It depends on the product. Regulated savings accounts and term deposits guarantee the capital invested. Money market funds and participatory lending, on the other hand, carry a real risk, even if it remains measured over short durations and diversified amounts.

Is participatory lending suitable for precautionary savings?

Not in its entirety. It usefully complements precautionary savings already covered by liquid savings accounts, through a side pocket for which you accept the temporary lock-up and the risk of default.

What taxation applies to a short-term investment?

Regulated savings accounts (Livret A, LDDS, LEP) are exempt from tax and social levies. All other products, term deposits, money market funds and participatory lending, fall under the PFU at 31.4% since 1 January 2026.

Choosing your short-term investment means above all choosing the right balance between safety, availability and return, according to what you really expect from this money. The best approach often remains to mix: a liquid, risk-free base for the unexpected, then a more dynamic share for the rest, calibrated according to what you are prepared to lose. None of these solutions is better in absolute terms. And you, what share of your savings could you put to work a little more?

The content of this article is provided for informational and educational purposes only. It does not constitute investment, financial, tax, or legal advice. Peer-to-peer (P2P) lending and crowdlending investments carry a risk of partial or total loss of capital. Past performance does not predict future results. Liquidity on a secondary market is not guaranteed. Readers are encouraged to conduct their own research and consult qualified advisors before making any financial decisions. The availability of products and services may be restricted in certain jurisdictions.