Is Investing in a CD a Good Idea?

August 25, 2011  |  

(Bankrate) — For CD investors, safety of principal typically trumps building wealth as an investment goal. They’re willing to earn a reduced yield for the knowledge that they can’t lose money in the investment. However, there’s another risk, and that’s purchasing-power risk. If the yield on your CD isn’t higher than the inflation rate, your deposit loses purchasing power over time.

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