Personal finances:

glatt · 03-26-2010, 08:08 AM

1 year CD rates are around 1 to 1.5 percent. On $2000, that means you would make around $20 or maybe $30 in interest over the course of a year. If you lock into a 3 year CD or a 5 year CD, you will get higher rates, but my gut tells me that interest rates are going to go up in the next year, so you would be foolish to lock in to a long term CD right now when interest rates are at historical lows. You would be kicking yourself in a year or so when the rates are higher and you are locked into a low rate of return.

Is it worth it to you to take an hour or two to drive down to a bank to fill out the paperwork so that you make $20 in interest?

To make real money, you need to invest in the stock market, but there is substantial risk there, and you could lose money too.

I wish I had a good answer. It's a bad time to be shopping for CDs.

03-26-2010, 08:08 AM	#2
glatt ™ Join Date: Jul 2003 Location: Arlington, VA Posts: 27,717	1 year CD rates are around 1 to 1.5 percent. On $2000, that means you would make around $20 or maybe $30 in interest over the course of a year. If you lock into a 3 year CD or a 5 year CD, you will get higher rates, but my gut tells me that interest rates are going to go up in the next year, so you would be foolish to lock in to a long term CD right now when interest rates are at historical lows. You would be kicking yourself in a year or so when the rates are higher and you are locked into a low rate of return. Is it worth it to you to take an hour or two to drive down to a bank to fill out the paperwork so that you make $20 in interest? To make real money, you need to invest in the stock market, but there is substantial risk there, and you could lose money too. I wish I had a good answer. It's a bad time to be shopping for CDs.

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