Comments on: Don’t Forget About Your Maturing CDs – It Could Cost You http://genxfinance.com/2006/11/05/dont-forget-about-your-maturing-cds-it-could-cost-you/ Helping a unique generation achieve financial independence. Sat, 13 Mar 2010 15:33:11 +0000 http://wordpress.org/?v=2.9.1 hourly 1 By: Journey To Financial Freedom http://genxfinance.com/2006/11/05/dont-forget-about-your-maturing-cds-it-could-cost-you/#comment-52 Journey To Financial Freedom Sun, 12 Nov 2006 23:53:19 +0000 http://genxfinance.com/2006/11/05/dont-forget-about-your-maturing-cds-it-could-cost-you/#comment-52 Carnival Of Investing Week 61

This week, Journey to Financial Freedom will host 2 carnivals – Carnival of Debt Reduction #61 and Carnival of Investing # This 2 carnivals really kept me busy for a few to put all the articles in order. So I also hope that these 2 carnivals will mak…

]]> By: Jeremy http://genxfinance.com/2006/11/05/dont-forget-about-your-maturing-cds-it-could-cost-you/#comment-27 Jeremy Mon, 06 Nov 2006 03:20:50 +0000 http://genxfinance.com/2006/11/05/dont-forget-about-your-maturing-cds-it-could-cost-you/#comment-27 That is exactly right. If we were in a decreasing rate environment, then locking up money for a longer term could be helpful, but like you said, guessing on rate movement outside of about 6 months is anyone's guess. As an advisor that spent some time at a retail bank, I had <b>many</b> clients who were older, and simply let their CDs just roll forever, and have been doing it for years. Well, anyone who was doing this with long-term CDs in the past 5 years have been losing a lot of money. Some of these people were holding 5 year CDs earning just barely 1% since about 2000. When you look at how much they missed out on over the past couple years in rates it is a shame. Of course that is another topic for a later date I'll tackle, interest rate risk and how that can affect so-called "safe" investments. That is exactly right. If we were in a decreasing rate environment, then locking up money for a longer term could be helpful, but like you said, guessing on rate movement outside of about 6 months is anyone’s guess.

As an advisor that spent some time at a retail bank, I had many clients who were older, and simply let their CDs just roll forever, and have been doing it for years. Well, anyone who was doing this with long-term CDs in the past 5 years have been losing a lot of money.

Some of these people were holding 5 year CDs earning just barely 1% since about 2000. When you look at how much they missed out on over the past couple years in rates it is a shame.

Of course that is another topic for a later date I’ll tackle, interest rate risk and how that can affect so-called “safe” investments.

]]> By: Harm http://genxfinance.com/2006/11/05/dont-forget-about-your-maturing-cds-it-could-cost-you/#comment-26 Harm Mon, 06 Nov 2006 02:33:49 +0000 http://genxfinance.com/2006/11/05/dont-forget-about-your-maturing-cds-it-could-cost-you/#comment-26 Good point....normally, I WOULD like to keep my money tied up for as short a time as possible, assuming equal rates. However, if we are heading for a long period of lower rates (no one knows for sure, of course) it would be nice to have SOME money 'locked up' for a longer term. Good point….normally, I WOULD like to keep my money
tied up for as short a time as possible, assuming equal
rates. However, if we are heading for a long period of
lower rates (no one knows for sure, of course) it would be
nice to have SOME money ‘locked up’ for a longer term.

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