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Author: sonny36 One star, 50 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 76902  
Subject: Re: CD Protection Strategy Date: 1/22/2001 7:14 AM
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If you have over 100K in your savings and investments, why would you want all of it CDs. Over the long haul inflation will eat you alive. Yes you need a 3 to 5 year cushion for expenses and emergencies, but the rest should be in the market for long term growth. Historically, the stock market will help you beat inflation. I am talking about buy and hold, not day trading in stocks. With CDs, inflation is your biggest risk. Historically the market has return approximately 11% compounded annual growth. Of course some years it is lower and other years higher. If you just buy a good low cost S&P 500 Index like Vanguards, you will ahead of the game, if you have that 3 to 5 year cushion of CDs or Bonds to protect you.
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