Recently I began to ponder upon some of the changes in my life at a stage when most are planning for retirement. Having two very young sons, however, has led me into a much different path in my musings. How do I provide for their future? As I thought about this, a number of options crossed my mind. Almost any kind of investment comes with some risk. Realizing the importance of having a solid financial base for a college education for them, I wished to minimize that risk while still ensuring the best possible return on my money. As I have watched part of my retirement money melt away with stock market fluctuations along with the fact that the stock market is for the longer term, I realized that stocks were probably not the way to go.
Lately I have concluded that government bonds are no longer viable for this situation, so I turned to looking at what some of the local banks were offering. While a simple savings account is fine for that rainy day fund ( and necessary too, I might add), that type of investment did not give the needed return. It was very flexible, allowing me to withdraw money whenever needed and deposit whenever I had some extra, but it also had a rather low interest rate. I checked into the money market which is also rather flexible and found a slightly better rate; however, after shopping around, I did find a savings vehicle that seemed to be a good fit. Certificates of deposit yield a higher interest rate and allow flexibility of both amount and time.
A website that gives excellent information on different investments may be found at http://www.fdic.gov/consumers/index.html. Many of my questions were answered by this page. The drawback to this type of investment is that there is a penalty for early withdrawal, but one may choose the length of the term until maturation. Of course, the longer the term, the greater the rate will be. One can find a good comparison of rates on the best CD by visiting Discovery Bank.