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#11
08-09-2005, 06:41 PM
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Re: FDIC Insured.....
A strategy of going to all cash for 4-6 years is generally a bad one. This would depend also on how old you guys are and whether you have a continuing income stream from which you continue to be able to save additional $$.
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#12
08-09-2005, 06:45 PM
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Re: FDIC Insured.....
Why are you worried about banks? It is highly unlikely that a bank will fail. You might want to match your investment life better with your investment choice. See if Vanguard has an intermediate 3-5 year bond fund. You'll get better returns with limited interest rate risk.
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#13
08-10-2005, 01:12 AM
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Re: FDIC Insured.....only on the principle
Just to clarify...
If you have money in an interest bearing account, and the bank does go under, the FDIC will not reimburse the interest earned.
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#15
08-10-2005, 05:26 PM
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Re: FDIC Insured.....
There is some interest rate risk involved in buying long term bonds funds. If long term rates for current bonds were to go up, the present value of the already issued long term bonds would go down (and vice versa). That is why the value of the long bond fund fluctuates. FWIW I think the long bond fund it is a very sound investment as far as US dollar denominated assets are concerned.
I think Colgin advice is very good as well.
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