certificate of deposit

Every day I meet with someone across from my desk who’s frustrated with the low interest rates C.D.’s are paying today on their savings. They remember the good old days not that long ago of when you were rewarded for having savings with interest rates of 5%-6% and you could live on the interest made from your C.D.’s.

Today’s low C.D. rates are a different story. On one hand you want to make a better rate of return than current average rates of 1% or less. But on the other hand, you don’t want to take uncalculated risk with your savings, since you realize if you lose it, you’re probably never getting it back.

So what are the millions of savers in our country to do in today’s extremely low C.D. interest rate environment? This is a question I get daily everywhere I go, since people know what I do. I have the answer, but it is not in hopeful thinking that C.D. rates will return to 5%-6% again because I believe it’s going to be many years, if ever, before they do. My answer is diversifying some of your savings in other places besides C.D.’s that may offer a better rate of return.

There are many choices when it comes to counteracting the low interest rate environment, but it does involve taking risk. Financial products like senior banknotes, long/short bond funds, Real Estate Investment Trusts, bond ladders, fixed income mutual funds, fee based managed conservative portfolios, or even insurance products like fixed or fixed indexed annuities may be some great alternatives to diversify some of your C.D./savings into. But, there is risk in all these options you need to understand before investing in any of them.

To learn more about some of these options, call the office at 830-609-6986 to set up a 15-20 minute no obligation phone appointment. This month we are also having a seminar on a fixed income alternative in San Antonio at Paloma Blanca on March 24th that I would recommend attending. The RSVP deadline for this seminar is Friday March 10th by noon and seating is limited.