For those of you who recently looked up your ING Direct accounts lately and saw 1.4% yield, this post is for you. Those saving accounts and CD’s just aren’t performing like they used to. The frugal lifestyle is not as glamorous as the stock-tipping spend thrift. It’s now going to take TIME to accumulate money; the quick bucks are gone. However, that my friends is not necessarily a bad thing.
Does this make Savings Accounts and CD’s bad investments?
- No, although it is ultraconservative, you cannot lose your money with these investments. My grandmother is always is telling me she is worried about her bank “failing” and my reply is always, “If you lose the money in your savings account we (all Americans) are all in serious trouble.”
- Also, inflation has been relatively stagnate so you are not losing your future buying-power. That was always my favorite argument against savings instruments in the past.
What about holding on to my money?
- Honestly, that’s not a bad idea either, especially if you are a “doomsday-er”. Stuffing your mattress did work in the past, so maybe it’s time to reinstate that policy. However, I would advise that you make sure no one knows you are hoarding money and a fireproof safe would be a great investment.
- Stocks and Real Estate right now should be a “rich” man’s game. For every expert saying now is the time to get in there are 3 more saying to stay out. Trust your gut!
Ideally, if you have some credit card debt and a car payment, I would work to get rid of those ASAP. It makes no sense to put $1,000 on a stock or in savings when you are paying 21% interest on a $5,000 CitiCard. Once you are out of the shackles of credit, the world of investing will be wide open to you.
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