Local credit union offering 5 year CD at a 3.00% rate

I might put some money into a CD at a 3% rate. Any guesses on whether we will see 4% rates for a 5 year CD coming up this summer?

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It’s possible. There is some speculation that the Federal Reserve Bank will raise the Fed Funds Rate to almost 4% before the tightening cycle is done, which will have knock-on effects for 5-year Treasury Bonds and CDs. Rates may peak in 2023 sometime. By the way, you can buy a 5-year US Treasury Bond which will yield 3.3% annually if you hold it to maturity.

Remember the Carter years… when the genie is let out of the bottle, who knows where she goes.

It is pretty obvious that the genie has been let out of the Bottle!

As I recall my Company 401K plan offered 15% fixed rate for several years during Carter. It was a great time to build the 401K but not at 3%. Keep your options open and your Powder Dry!!!

I remember dad locked in some cds in his IRA at 15% for, I think, 5 years. Don’t remember what the inflation rate was, but it was high.

you can already get 4%+ on fixed rate 5 year CD annuities…tax deferred too.

Where is that, through Vanguard or such?

The rates paid by banks on savings accounts gives a new meaning to the term “bank robbery”.

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you can already get 4%+ on fixed rate 5 year CD annuities…tax deferred too.

no morning coffee yet, missed the annuities part

oh 1980-1981. those were the days. if you bought a 30 year Treasury in 1980 and held it until 2010 you made out great

Ford’s term highest rate was 10.260%
Carter’s term highest rate was 13.383%
Reagan’s term highest rate was 16.691%

Well sure you can get those rates on annuities because after you die your heirs get zero! It’s wealth confiscation!

I guess you think Clark has incorrect views on annuities as well

Go complain to Clark about it. It’s his website. Let’s see what he thinks about annuities. Maybe annuity salesmen have a bad reputation for a reason?

Many annuity salesmen should have a well deserved bad reputation for selling overly complicated, overly hyped products to people who do not understand them….hence the need to offer the free steak dinner to come to the sales pitch. These are typically deferred index annuities with income riders…

You can only lose money on a Variable annuity, which is the kind that CH primarily warns about.

Keep in mind I only made the post because you made a false statement about annuities not having beneficiaries upon death. Never said annuities were good or bad, but fixed rate annuities currently pay better than CD rates with the only risk being the financial viability of the company that sells them, and the interest is tax deferred.

You do know that Social Security is an annuity? Die early and the government keeps the money just like you said.:sunglasses:

At 83 and having been retired since 2004 I am ahead of the game having spent all my SS and yours.

Sorry about that. :smirk_cat:


Penfed is offering 3.5% 5-year CDs through July 7th:

I don’t buy CDs myself, but maybe some will find it compelling.

Some of my bond ETFs and bond mutual funds have yields in that range. My favorite etf, BND, has a 30 day yield of 3.39%. Big whoops, right? I am gonna wait and see if we hit that 4% CD rate range. I can lock money up in EE bonds that end up with 3.5% rate after a 20 year hold, but that is 20 years to get my money doubled. I am confident I know nothing about where rates will go, but I am sure that it is better if rates fall, so I am stockpiling cash more and taking a wait and see approach.

Repeating this: with bond funds with no fixed maturity date, like BND, you will whipsawed by capital gains and losses caused by interest rate fluctuations. Look at BulletShares ETF with an end date and hold to maturity.

The BND is in my IRA. I am looking at a 20 year window here. I concede that the fund has no firm timeline for its bonds. BulletShares I am not up on. I will look into them.