As you might guess, "best" kind of depends on how you define it -- I gather that means higher returns then her savings account. But does best include not being able to get your money out for 5 years without a significant interest penality? -- 5 year CDs are paying about 5% at some places. Does "best" require she can walk into a building and get money or is she willing to work by mail?Similarly safe has a whole lot of definitions -- I think GE and Starbucks are pretty safe -- but they may drop by 20% and require you to wait a period of 2 or 4 years to get back.Right now it appears we are in a period of rising interest rates. That means if you invest in bonds they could easily "loose" 15% of their value and you will not get the money back until the bond pays off in 10 years (or what ever the length of the bond is).Now that I have been flipant, it sounds to me like your friend probably would be best just finding the highest yeilding savings account and staying there for a year or so. That is based on the feeling interest rates a year from now will be significantly higher. At that point get some CDs. If she wants to do something better for a year, then get into a 12 month CD. But make sure it does not automatically renew -- she may a year from now want to look a little further out on the yield curve.GordonAtlanta
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