It's 2009 - Do You Know Where Your Money Is?

January 5, 2009
By Kevin Cafferty

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Welcome to 2009!

Those of you who followed finance news in 2008 (as well as those of you who didn't) may have noticed that the U.S. economy was a bit, well, not great over the past year. The stock market took some big hits and a lot of people's hard-earned savings was put in jeopardy as a result.

I just wanted to start my inaugural blog of the new year by once again reminding everyone that the safest way to protect your investments is through FDIC-insured CDs. CDs offer a higher rate than traditional savings accounts, with the caveat that the money is held by the bank for a fixed term (anywhere from 3 months to up to five years) while offering a fixed rate of interest.

I don't need to tell you that one of the best places to get great rates on CDs is MoneyAisle, but I'm going to tell you anyway.

When your savings is held in FDIC-insured CDs there's no danger of a market crash wiping out 60% of what you had saved - the money percolates in the account, collecting interest and paying you a great return on your investment - stress-free.

If you're currently sweating over what the stock market is doing to your savings, it may be time to look into CDs. As Mukesh told us last month, if you had put your money in high-interest-rate-paying CDs over the past 10 years and rolled them over to yet more high-interest-rate-paying CDs at their maturity, you are likely to have earned a completely risk free 5%+ on an annualized basis, trumping the under 2% a diversified portfolio put together by a fund manager would have gotten you.

Happy New Year, everyone. And Happy saving!