I'm truly no rocket surgeon, but I'm definitely not some fuckin' chimp, either

FastChef
FastChef

I'm truly no rocket surgeon, but I'm definitely not some fuckin' chimp, either.

I (humbly) have $20,000.00 USD to invest in. I'm very vanilla and by no means much of a risk-taker when it comes to my money, so I'm really finding this prospective CD Ladder concept very enamoring.

I really don't mind making pennies off the dollar (since I'm not using this "emergency" savings for anything, anyways). It's truly better than my money just rotting in my bank account not doing anything.

Anyways, Veeky Forums always shoots straight and has the most "real world" perspective... I was wondering, if you're in this position, is this what you would pursue? How would you pursue it?

Fried_Sushi
Fried_Sushi

@FastChef
Rates are so bad that I wouldn't do it personally. But it's fine if you're extremely risk-averse. If you want to increase your returns a bit, you could always invest a small portion in securities, but if you don't feel comfortable doing that, then don't.

Playboyize
Playboyize

@Fried_Sushi

As long as the rates are better than my bank account percentages, I don't think I mind too much.

I'll definitely look into some financial advice about specific, low-risk securities, though.

Carnalpleasure
Carnalpleasure

@Fried_Sushi
they will go back up though.

Sharpcharm
Sharpcharm

@FastChef
A nice ETF, Vanguard, diversify a bit with USA/EU for minimal risk. Don't venture into anything you don't know a lot of about it, like don't invest in womens fashion unless you're one hell of a drag queen. Don't expect humongous returns, maybe diversify a bit with a rising economy like India or Brasil (personally I believe Brasil is a great opportunity to come, but don't take my word. Please don't listen to strangers on the internet on how to use your money.) Don't go into VR stocks, Tesla or any meme bullshit, you won't make a killing anyways and don't do some bullshit CD laddering.

Evilember
Evilember

@Sharpcharm
honestly he'd have better luck with options trading

WebTool
WebTool

@Carnalpleasure

They will go back up though.

Sometimes it's hard to be optimistic about that, but I've definitely heard my fair share of this quote.

RumChicken
RumChicken

@Sharpcharm

If I'm truly not looking for humongous returns, why not do some "bullshit CD laddering."?

Ultimately, I just want to put my money in something equivalently safe as a standard savings bank account, but make a little more money from it.

Also, no worries, I'm not an idiot that will fall for the "DUDE, TESLA IS COMING!" type shit, haha.

CouchChiller
CouchChiller

@FastChef
Rates are shit. Liquidity is shit.

If i were to do a CD ladder i would just cycle 6 month CD. Get one 6 month cd every month for 6 months. Everytime one CD matures Add more to another 6 month.

This will allow a CD to mature every month to keep your cash a little more liquid. You might also get different interest rates.

Seriously OP if you are looking for a better return i would do a short-midterm bond ladder with trust worthy companies.

GoogleCat
GoogleCat

@CouchChiller

I was thinking 6 month cycles, as well. Thank you for the reassurance.

I won't lie to you, rates and liquidity are both shit, but that's what I sign up for being a risk averse investor, haha.

I have minimal proficiency when it comes to confirming what is a "trust worthy" company to invest in. That shit is like Vegas gambling to me.

Fuzzy_Logic
Fuzzy_Logic

@GoogleCat
If you're here looking for validation for your idea, you are validated. Now go out and do it.

Stupidasole
Stupidasole

@CouchChiller
the lengths dont matter so much as the timing of each buy

whereismyname
whereismyname

@Fuzzy_Logic

I'm so hyped now; I have all the motivation I need.

This (at the end of the night) is truly what I wanted to hear the whole time.

If I heard things like, "That's fuckin' retarded because...", or something along those lines, I would see it as constructive criticism and move on to a new idea.

Thank you for your validation, user. I truly appreciate it!

Nojokur
Nojokur

maybe look into a low duration bond etf to compliment your ladder? if youre buying 6 month CDs your going to make almost nothing. It seems like you know this but t even to get close to 1% youll have to buy brokerage CDs instead of bank ones which you could, in theory have to sell at a loss if you need the money before maturity. I'd look into maybe some Pfizer or GE bonds. I'm not toowell versed in fixed income admittedly but the credit ratings are pretty straight forward.

Spazyfool
Spazyfool

@Stupidasole

For sure, but the more liquid your money is (by maintaining 6 month cycles as opposed to 1-5 year cycles), the more able you'd be to take advantage of better return percentages that become available to invest in.

Fried_Sushi
Fried_Sushi

@Nojokur
this also
you're losing out to inflation by at least 1%
while this may be better than losing out to inflation at 1.999%, you could always go with options trading.
since you dont like having to trust a company, you just trust things like options price, implied volatility, and liquidity.

Stark_Naked
Stark_Naked

@Spazyfool
i supposed if you're really worried about short term liquidity you could ladder into a monthly 1-year turnover.

Lunatick
Lunatick

@Fried_Sushi
what options strategies are you suggesting?

Booteefool
Booteefool

@Fried_Sushi

Is this something that I can proficiently learn by myself, or does require a "professional" to make suggestions to me?

King_Martha
King_Martha

OP, I just looked into it. Pfizer has 5 year bonds at 5.74% ytm.

Spamalot
Spamalot

@Lunatick
selling puts

@Booteefool
tastytrade.com
dough.com

girlDog
girlDog

@Spamalot

Thank you for the links, user.

farquit
farquit

@King_Martha

That's relatively enticing, but going back to liquidity, I can respectively see this number be even higher in a few years. Do I want to lock in $20,000.00 for 5 years knowing that now there's something more readily profitable (even outside of Pfizer)?

That's where it comes back to the ladder scheme of shorter time increments.

Methshot
Methshot

@King_Martha

Also, what source(s) do you use when looking for bonds (like this Pfizer bond)?

PackManBrainlure
PackManBrainlure

@Methshot
Seconding this.

Boy_vs_Girl
Boy_vs_Girl

@PackManBrainlure

Damn it. No reply in a while.

I really want to know the source(s).

BlogWobbles
BlogWobbles

@Methshot

You can trade bonds on most platforms. I use Vanguards.

Bonds have a bigger market and higher volume than stocks. Big money plays with bonds.

DeathDog
DeathDog

@FastChef

Also, kid, $20,000 is nothing. It's literally nothing. I'd give up your pitiful $500 a year you would make in interest and make sure my money is safe.

Come back when you at least have $10m. Maybe we'll talk to you then.

FastChef
FastChef

@DeathDog

Hence why I said, "humbly." This implying that it's not much, but it's still better than pocket change and gum wrappers. That's why I'm asking for a safe way to maintain my savings, but make a little more than what the banks provide (when kept in my savings account).

You think I would be looking for advice from you right now if I had $10,000,000.00?

Also, thank you for your previous post about Vanguards... I'll definitely look into it!

BunnyJinx
BunnyJinx

@Methshot
sorry I went to dinner. usually I would look them up through a trader at work but I used Morningstar.com for that info. fwiw, those bonds are liquid, you could get them off you hands in minutes if you needed to, granted you might take loss if the fed raises rates (unlikely short term, imo)

StrangeWizard
StrangeWizard

@BunnyJinx

No worries, bro!

Thank you for responding back, you've definitely been a huge help to me!

Booteefool
Booteefool

@FastChef
You're lucky to get a rate above 4.0 for a % in most cases for a 5 year. I do research on CDS I work at a community bank. Smaller banks generally offer better rates for CDs and you can always negotatiate the rate especially if you have multiple accounts with them. This also gives you a terrible return on your money regardless

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