Finding The Safest Investments For Your Money In 2010
With the current economic problems and the volatility in the stock market, people want to find out how to get the best interest rates. They are nervous about investing and want to be sure their money is absolutely safe. Often people will choose a lower rate of return now just to ensure that their investment is secure. So what options are available if you have some money to invest and want to earn more interest than checking and savings accounts are paying?
Probably the safest choice are bank certificates of deposit (CDs) since they are guaranteed by the FDIC, which is a federal government agency. You have to trust in this FDIC insurance, because if it failed it would mean that the U.S. government also failed and chaos erupted. Sadly, CDs are only paying around one percent, which is a historically very low return rate.
You might think that the most beneficial CD rate available would be reserved for the longest term CD, but this is not always the case. If you check the CD rates available through your bank, you may be surprised to find that the 30 year and 15 year CDs are not paying as high an interest rate as CDs for shorter time periods. There are special promotions available that may enable you to obtain the most profitable interest rate on a CD for a shorter length of time.
These low rates really hurts all the people that need interest income to help them get by which are often retired people and seniors. It may be advisable for young people to invest in stocks and other vehicles that have some risk and can give a better rate of return but not older people. This is because young people have a long time horizon and can withstand market fluctuations but older people need to have their money available at all times.
For safety, other good alternatives are Treasury bills, or just holding on to your cash. In reality, you are providing the U.S. government with a free loan, and the rate of return is lower than that of a CD. . Holding on to cash means that your nest egg will not keep up with inflation, and the value of your money will decrease. The majority of individuals are experiencing financial difficulties during this time of economic turmoil.
Article Source: FxTradingStock.com
About the Author
Do you want to learn about getting the best no risk CD rates? Please go to my website Interest Rates On CDs to learn more.
by: Kent Jackson
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Word Count: 398
Date: Mon, 14 Jun 2010
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