Which is a better investment and will give you the most interest? I was considering putting some money in the bank. I will not need it for a while and I would be most concerned with the interest rates. Please tell me about these and which is better to invest in?
2006-07-22 07:52:16 · 6 answers · asked by Stinky 2 in Business & Finance ➔ Investing
right now the conditions of the market are unstable so you are very smart to thing about cash investments.
the value of a bond goes down as interest rates go up... intrest rates are going up so unless you are retiring now, bonds are not a good short term investment.
a savings account is good for emergency money, an online savings account like ING is a good Idea for some money. You should definatley have some emergency money
CD's are probably the best thing you can do right now. Here's how I would do it.
on month 1, i would put 1/3 in a 3 month CD.
on month 2, i would put another 1/3 in a 3 month CD
on month 3, i would put the last 1/3 in another
on month 4, the month 1 CD becomes available at that point how is the market doing. if not good roll it back into an other CD and continue the process
if you have a lot of money, i would do the same but with 6 month CD's
if your balance is inbetween change the fractions to 1/4 and put the final 1/4 into a 6 month CD.
when the market improves I would invest the money from the CD's in indexed funds. you can learn about them at www.vanguard.com
Good Luck
2006-07-22 08:29:10 · answer #1 · answered by yeeooow 4 · 1⤊ 0⤋
All the investments you mention are considered safe. All are guaranteed by the government. (I take it you are talking about savings bonds, not corporate or other types of bonds.) In general, the longer you take out a CD, the more interest you will get. However, please note that interest rates are rising... in two years, your rate may not seem so good. Consider investing in CD's for a maximum of six months right now. Leave the rest in your savings account which hopefully draws a little interest. The bonds are typically longer term investments. To really do a fine job of investing, go to your local bank with brokerage services or perhaps to a recommended broker in your area. Let them do a complete financial plan for you. They'll probably recommend mutual funds, bond funds, etc. Listen and learn. But the bottom line, it's your money... so it's your final decision in whatever investment you decide to make.
2006-07-22 09:51:46 · answer #2 · answered by Mike S 7 · 0⤊ 0⤋
Bonds are long term investment. CDs are Shortterm investment with fixed maturity period. Saving accounts is just like on call money. The yield from all this investments are benchmarked against the BLR. Which ever you go will give you more or less the same return. If you look for liquidity, then go for saving account. If you are thinking about million dollar investment then go for CD or Bonds and learn how this instruments are traded in the market.
2006-07-22 08:13:25 · answer #3 · answered by mae_qad 1 · 0⤊ 0⤋
Saving accounts give pretty crappy rates. CDs will be slightly better, but they're shorter-term. You'll have to constantly roll your money into new CDs. Bonds are OK, but a conservative investment. You'll do better with stocks.
What's your investment time-frame and goal? Why not choose a mutual fund that invests based on your particular strategy? There are a lot of good fund families out there like Fidelity and Vanguard. You can look on their website for further info.
2006-07-22 07:57:28 · answer #4 · answered by katzchen75 4 · 0⤊ 0⤋
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2016-10-15 02:08:04 · answer #5 · answered by restrepo 4 · 0⤊ 0⤋
No load stock mutual funds over the long term will provide you with a higher return on your investment.
2006-07-22 15:28:01 · answer #6 · answered by John H 4 · 0⤊ 0⤋