Expert: Gina Boykin - 12/5/2007

Question
I HAVE SOME INVESTMENTS , EX LOCAL BANK, CD AND MONEY MARKET.      5 % INTEREST. FOR 1 YR. 50,000.00
NOT SURE IF I SHOULD REINVEST IN THAT AGAIN OR FIND SOMETHING DIFFERENT. I DON'T NEED THE MONEY FOR A FEW YEARS.
THANKS STACEY

Answer
If you plan to use the money within the next 5 years, it's fine where it is.  If you are trying to keep it in something low risk, one other option is a money-market mutual fund.  The rate MAY be a little higher.  It is an investment (instead of a savings vehicle) but it is invested in things like government bonds and CDs.

You can also do treasury notes, which mature in 2 or 5 years.  You can buy them in sets of $1,000 directly through the government at www.treasurydirect.gov.  You can check the website out to get current rates.

Anything over 5 years can be invested in something with a little more risk and higher return, like a mutual fund.