Poll: Economic Crisis Sends Investors to Seek Safety in Certificates of Deposit

February 3, 2009
By Mukesh Chatter

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MoneyAisle recently conducted an online survey of our users to see how different consumers were reacting to the current economic crisis.

Out of over 1000 respondents, we learned some interesting statistics. In light of the economic climate, 71 percent said they were more likely to invest in a CD, while 23 percent said they were equally likely to invest in a CD as before. Less than 2 percent say they are less likely to invest in a CD.

I've been reading a lot of anecdotal evidence that consumers are investing in safer asset classes during these uncertain times, and it was enlightening to get some hard data behind these stories. 89% of poll respondents said that when they look to invest for safety, they invest in CDs.
The combination of FDIC insurance (up to applicable limits, although with features like MoneyAisle's CD Ladder builder, you can spread your money across several FDIC-insured accounts so that all of your deposits are protected), a guaranteed rate of return, and a lack of risk are making high-yielding CDs the most attractive option for savvy investors during this difficult time.

New York Times columnist Paul Lim recently pointed out in one of his articles that S.& P. 500 returns over the past 10 years were, on average, negative. When you compare those negative returns to putting your money in high-interest-rate-paying CDs over the past 10 years (and rolling the money over to yet more high-interest-rate-paying CDs at their maturity) you are likely to have earned a completely risk free 4-5%+ on an annualized basis.

If you're curious to see other results from the poll, you can see a news release on the subject here. I'd be interested to hear your thoughts on the matter.