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I'm eighty and the Mrs. is 76, both in good health. We have $85000in Wellesly Income (Vanguard) earning about 7%. We have another $80000 in CD's earning 2.5% now but soon to roll over. Suggestions for putting the CD money, please. We do not need current income from investments.
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I'm eighty and the Mrs. is 76, both in good health. We have $85000in Wellesly Income (Vanguard) earning about 7%. We have another $80000 in CD's earning 2.5% now but soon to roll over. Suggestions for putting the CD money, please. We do not need current income from investments.

Are you saying you want to invest the $80k CD money in something more aggressive? If not for retirement income, what you envision this money will be for? How much risk are you willing to take? What is the rest of your portfolio like?

Fuskie
Who also needs to know what realistically your investment timeframe is...
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You might consider diversifying from 100% US$ to other currencies with CDs from www.everbank.com. If you have alot of pension type US$ income you might want to go 100% foreign currencies so that if there is trouble with the US$ you will be protected somewhat. Note that you cannot bet with the US$ on your pension and against with your cash and win both bets, so prepare for bad news one way or the other.
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Note that you cannot bet with the US$ on your pension and against with your cash and win both bets, so prepare for bad news one way or the other.


Yes, hedge betting is a proven way to make sure that you have a less-than-average or even disastrous result. So why are you recommending it again? --the puzzled blue bird
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>> Yes, hedge betting is a proven way to make sure that you have a less-than-average or even disastrous result. So why are you recommending it again? --the puzzled blue bird <<

Because if you have more than you need, you may want to consider a "hedge" as the cost of insurance against a disastrous outcome. It's likely to reduce a suboptimal long-term return, but can also significantly reduce risk associated with some disastrous outcomes that have been hedged away.

Investing for maximum growth is not always the right way to go. In this case I'm not sure hedging with foreign currencies is the way to go, but it's not unheard of as a risk management tool.

#29
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When you advise against hedging are you suggesting investing 100% in US$ or 0% in US$.

"less-than-average" Actually what am am suggesting is going for a kind of average global/international CD return.

"even disastrous result." Diversifying across currencies will only be disasterous if all currencies fail at the same time.
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adobew1 asks,

I'm eighty and the Mrs. is 76, both in good health. We have $85000in Wellesly Income (Vanguard) earning about 7%. We have another $80000 in CD's earning 2.5% now but soon to roll over. Suggestions for putting the CD money, please. We do not need current income from investments.


If you don't need the money for current income, what is the purpose of these funds?

For example, if it's likely to end up as a grandchild's inheritance, maybe you should invest it with your grandkids time horizon in mind rather than your own -- that would suggest a higher allocation to equities.

intercst
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Suggestions for putting the CD money, please. We do not need current income from investments.

Since you don't need the income, why not look at I-bonds?

www.treasurydirect.gov The prinicipal is safe, you get some inflation protection and the income is tax deferred.

Do you have a written financial plan that addresses all areas of your financial affairs? Insurance, investing, retirement distributions, taxes and estate planning

If not you should.

buzman




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As others have stated, without knowing what you're saving/investing for, no serious answer.

Humorous answer. Given your age, green bananas might be considered an investment. ;)

JLC
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I would consider puting these $80K with Vanguard VILPX (Long term Insured Tax Free Bond fund)or with vanguard VWELX (another managed fund of Vanguard with a different ratio equities/Bond) and ask them to reinvest all dividends and to pay me for Capital gains.
My 2 cents....
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