Why Certificates of Deposit Might Not Be the Best Option: Discover Better Investments
Thursday, 16 May 2024, 15:01
3 Reasons to Stay Away From CDs, Even With Rates at 5.60%
Certificates of deposit might be a lucrative investment, but they're not right for everyone. Keep reading to learn when a CD is the wrong money move for you.
1. Meeting a minimum investment might be a problem
- Many of the best CDs require a minimum opening deposit, like $1,000.
- If you don't have enough savings to meet minimum requirements, you might be better served by a high-yield savings account.
2. T-bills have almost identical rates -- but with an added tax benefit
- Treasury bills (T-bills) have competitive rates and offer tax advantages compared to CDs.
- You can buy T-bills with as little as $100, making them accessible to more investors.
3. Long-term investors might fare better in the stock market
Investing in the stock market over the long term may yield higher returns compared to short-term CDs.
In conclusion, diversifying your investment portfolio with options like T-bills and the stock market can potentially enhance your returns and financial growth.
This article was prepared using information from open sources in accordance with the principles of Ethical Policy. The editorial team is not responsible for absolute accuracy, as it relies on data from the sources referenced.