Money CDs, how much in each?

[Kalhoun]

@friedo

These days, you can get 5% on fully liquid savings accounts, too.

As for CDs, I personally don’t like anything less than a year. If you need the money back that quickly, you might as well have it in a liquid account with a decent interest rate. A good strategy is a CD Ladder with an equal amount in each tier.

I’ve got both a 5% savings and a 5.6% CD (13 months). Both are absolutely safe. Aren’t bonds a good bet these days, too?

[Canadjun]

@LSLGuy

There is no advantage to buying a 3 year CD when a 1 year CD pays the same rate. And as between 4.87% and 4.88%, the yield difference is $1 per year per $10,000 invested. Not material.

It depends on which direction you think interest rates are going to go. If you think they will go down then you may want to buy the 3 year CD and lock in that interest rate for 3 years. If you think they will go up or stay the same you would want the 1 year CD.