You are here:

Bonds/CDs vs. Tbills

Advertisement

Expert: Doug Ingram - 8/11/2006


Question
I am looking for as safe, short term (6-9 months) investment. I can get a $250,000 CD that pays 5.3% from a large antional bank. Or I can buy 182 days Tbills which are currently paying about 5.2%.  Tbills are safer and tax free, seems like the obvious choice. I am missing something?

Thanks for your time

Answer
I think you're right on.
Some states are tax free anyway and the CDs would be a little better.
With the bank, you may only be insured to $100,000, but that's probably no a problem.
If you have a state tax, the Bills are safer and would be the better choice.

Bonds

All Answers

Ask Experts

Volunteer

Doug Ingram

Expertise

Fixed income portfolio allocation and strategies for institutional investors. Having designed multi-scenario risk quantification and cash flow projection models for nearly 25 years, Strategic Technical Initiatives can answer your regulatory, SFAS 115 allocation, securities selection, and other questions dealing with yield curve placement and portfolio mix strategies. I write the Bond Market Review on behalf of Commerce Street Capital Management.

Experience

Trading and designing portfolio strategies since 1980.

Education/Credentials
Physics and Differential Mathematics

©2012 About.com, a part of The New York Times Company. All rights reserved.