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"In retirement now with my pension "lump-sum money" rolled over into a tax sheltered CD with mandatory distribution at age 70...wondering if there is a better than 5% that I am getting now from my bank.. thank you for your help...JohnP14 "

The issue with any investment is how much risk are you willing to take in order to get a higher return. Risk does not mean to Foolishly throw a dart at the mutual fund or stock tables. By learning about investments and how various investment vehicles work, you can minimize the risk you take.

One method of reducing risks is to invest in a very diversified mutual fund - specifically in some sort of index fund. Another means of reducing risk is to do it over a longer time frame than a year or two.

I have done a calculation of the S&P 500 since 1926 which shows that holding the S&P 500 for 5 years reduces the risk (Std Dev) from 20.1% to 8%. (BTW Govt LT Bonds have a yearly Std Dev of about 8%) For 10 years investment period, the Std Dev falls to 5.4%. The smaller the number, the lower the risk (volatility).

Yes there are a variety of investments which will yield more than 5% and there are means to keep the risks of these investments to a minimum.

I forget the author but when asked how to invest, he asked "Do you want to eat well or sleep well?"

BGP
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