So ive been making a lot of money from my job and i want to find a good way to start investing my money. I think a cd acount is the way i want to go. I need to know everything there is about cd's.
2007-07-22 06:22:07 · 5 answers · asked by Anonymous in Business & Finance ➔ Personal Finance
CD's are a safe term investment. If you look around at your local paper they range from 30 day to 5 year terms (or longer)
Your interest is paid at the end of te term. Now obviously if you take a 30 day CD you only get one twelfth of the interest.
The thing to be careful about is the length you decide to put you money away because if you need it earlier then you will lose some of your interest you earned.
CD's are simple and straight forward, but only if you do not plan on using the money for that term.
If you now you are going to need some at some time you may wamt to try a money market which of course has restrictions but you can make withdrawals and still get better interest than a savings account.
Remember, it does not cost a thing to go around the corner to your local bank and ask this same question.
2007-07-26 04:48:06 · answer #1 · answered by yourguessisasgoodasyours 4 · 0⤊ 0⤋
Actually, a good way to go is good quality mutual funds with proven track records. CDs are good in retirement, if you need fixed income, or if you want short safe investments. Thye return 5% at the top level. A good diversified protfolio of mutual funds will return 10% or more.
If you job offers a 401(k) or 403(b) (Or a government thrift savings plan) then you need to be investing in it. You should put in as much as possible. At the very least, put in as much as your company will match. It's free money.
Go to a website like fidelity and start reading. There are lots of resources out there on how to invest for your future.
CDs a re great for a retired person,l of perhaps for a child, but an adult should be taking tax advantages in a retirement account.
2007-07-22 06:52:00 · answer #2 · answered by Anonymous · 0⤊ 0⤋
Money market accounts provide about the same return without locking you in for a fixed term. If you plan to keep the money invested for 5 years or more, mutual funds are better than both.
2007-07-22 07:04:48 · answer #3 · answered by STEVEN F 7 · 1⤊ 0⤋
CDs lock your money up for six months or a year or longer, if you can afford that time, you are better off buying into a mutual fund, which isn't as "safe", but which all but guarantees you a far higher return long-term.
You can earn as much in a high-yield savings account as you can in many CDs, and they are just as "secure", if you have less than $100,000 saved...
2007-07-22 06:56:22 · answer #4 · answered by Anonymous · 1⤊ 0⤋
CD's are good. The Federal Rate is 5.25% so Iv seen many banks give interest rates close to that. I personally think ... that cds are a waste because most of the interest you make you end up paying off when you file your taxes. I personally think you should throw it in the stock market and take the chances. If you achieve.. your will be richer but if not then your broke :X. But if your not willing to take chances...... CD's are good because they are secured (UP To $100,000. FDIC). Remember once you lock them in you can't touch! And if you do decide to take your money out of a cd easy....... you get hit with a PENALTY!
Good Luck with whatever you choose!
2007-07-22 06:32:30 · answer #5 · answered by Anonymous · 0⤊ 1⤋