Any Bankers/Investors ?

[thi9elsp]

@ActionBob

Our broker earned his stripes with us for two things:

1. No fees on fixed income investments as I stated previously.
2. When he talked me off the cliff when COVID hit and I saw our securities, ETFs and Mutual Funds drop dramatically. Sure enough, as he said, "Stick to the plan". 6 Months later we were back to even.

Now the past year and a half has been frustrating, but we "Stick to the plan" and are living quite well in retirement.

 

[jimmywallstreet]

You mean you’ve refrained from getting CDs because of lack of liquidity?

We can get out money out of our CDs any time, yes there is a fee, but it’s only on the interest gained and a capped amount at that. Laddering the CDs monthly as indicated above is smart smart.

The 6-12 months CDs at 5%+ now are damn nice. Even our high yield saving is almost at 5.

Yes, rates are higher but a CD is not designed to grow your money it’s designed to protect it. So you also have to consider the rate of inflation on the buying power of your money that you earned. Today basic inflation is at 3.7%. It was at 8.6% last year so that means in one year you have to earn at least 3.7% to break even on this day next year. Anybody remember the 80s when you could get a CD for 13 to 15%. inflation was running at about 12 at that point. I’ve spent the last 25 years in finance trying to help people understand the buying power component. it’s an important indicator of growing wealth.

 

[baxterb]

Yes, rates are higher but a CD is not designed to grow your money it’s designed to protect it. So you also have to consider the rate of inflation on the buying power of your money that you earned. Today basic inflation is at 3.7%. It was at 8.6% last year so that means in one year you have to earn at least 3.7% to break even on this day next year. Anybody remember the 80s when you could get a CD for 13 to 15%. inflation was running at about 12 at that point. I’ve spent the last 25 years in finance trying to help people understand the buying power component. it’s an important indicator of growing wealth.

Yup. Good clarification!

 

[Brent in Az]

My Credit Union is offering 5.36% on a 15 month CD. Best rates I've seen from them so far.

 

[jimmywallstreet]

That’s a good rate for the term. What’s the penalty for breaking it early? Does it automatically renew at the end of the term?

 

[Brent in Az]

That’s a good rate for the term. What’s the penalty for breaking it early? Does it automatically renew at the end of the term?

I don't know? Just got an email from them this morning. I would have to look at the fine print.

 

[B0MBOY]

Who do you guys use to ladder these short term CDs?

 

[jimmywallstreet]

Look for a credit union in your area that you can be a member of and that is financially sound. They tend to have more loyalty to their clients. Avoid the big banks.