Short term vs long term FDs?
-
Hi to all of you!
For my $2,000 investment, I'm now debating between short-term and long-term fixed deposits (FDs). I'm not sure which option would provide the best returns for my short-term goals because interest rates are erratic. Could someone please explain the present Federal Reserve rate and offer some good short-term investing ideas? Your guidance would be very helpful!
-
The current Federal Reserve Rate is 5% to 5.25%, which you need to keep in mind while choosing between short-term and long-term goals. To control inflation and economic growth, the Federal Rates need to be changed from time to time.
But you have short-term goals, so you can choose High-Yield Savings Accounts, Certificates of Deposit (CDs), Money Market Accounts, Treasury Bills (T-Bills), and Short-Term Bond Funds.
All these options are good for short-term goals. They often require a minimum balance to qualify for the higher rates, have flexibility with your money, and have fixed interest rates from a few months to a few years.