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Smart Money Moves, Now That Interest Rates Are Rising

Tuesday, June 25, 2013 - 5:13 AM
I think some of the "smart money moves" in this Forbes article aren't the best moves. Excerpts:
Let’s look at savers first. Bank savings accounts, certificates of deposit and Treasury bills have paid just a fraction of a percent over the past several years. Pretty chintzy.

You should enjoy slightly higher yields on these types of savings alternatives. But, at the moment, I wouldn’t lock up your money for too long.

For example, steer clear of one- to five-year CDs for now

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Ken TuminKen Tumin5,471 posts since
Nov 29, 2009
Rep Points: 125,634
1. Tuesday, June 25, 2013 - 7:54 AM
"It probably isn’t too late if you want to join that exodus, since you aren’t likely to take a loss. The actual rise in rates, so far, has been relatively small — less than one percentage point over the past month — despite all the turmoil in the bond market.

I think it makes sense now to reduce your exposure to long-term bonds to avoid potential losses. Park that money in shorter-term fixed income securities, like money market funds and bond funds."

Good advice for bond funds.
51hh51hh1,476 posts since
Jan 16, 2010
Rep Points: 6,427
2. Tuesday, June 25, 2013 - 8:42 AM
Exit From the Bond Market Is Turning Into a Stampede
ShorebreakShorebreak2,677 posts since
Apr 6, 2010
Rep Points: 14,533
ShorebreakShorebreak2,677 posts since
Apr 6, 2010
Rep Points: 14,533