Some things are more important than your certificate of deposit rates
Whether you’re planning for retirement or simply looking to protect funds, finding reliable long-term investments often means comparing certificate of deposit rates at different institutions. CD rates tend to be low, and many plans end up surprisingly close to inflation. In other words, a portfolio with modest certificates of deposit rates may grow in dollars but not in real value. It’s better than just burying your money in a hole because $500 will be worth a lot less in decades. A bottle of Coke that used to cost five cents can now cost a dollar or more, and it’s not like the ingredients have gotten much better.
When you get to the point of comparing certificate of deposit rates at different banks and credit unions, it’s important to remember the big picture. Inflation will not only reduce the impact of any winnings, but withdrawing money early will usually mean penalties. If you get stressed out comparing all the details of the different options, remember that some things in life are more important.
Invest time, not just money
If you spend two full weekends comparing plans online and talking to investors, you’ve already made a significant investment. How many dollars per hour is your free time worth? Assuming you work full time, those hours at night and on weekends are even more valuable. If you were to pay yourself overtime for the hours you spent researching and comparing financial options, would the information you obtained be worth that much money?
It’s hard to “invest” time in a way that seems valuable from an hourly wage perspective, but “saving” time is more intuitive. If you need a complete portfolio for managed funds, why not hire a professional? They may charge a high hourly rate, but you also get the benefit of their years of training and experience.
Cultivate a wealth of experience
As any adviser will tell you, the best time to start saving is always now, the sooner the better. But earning money to book means extra hours of work or short-term past experiences. Sufficient funds can be set aside for investment through small lifestyle adjustments, such as packing a lunch and limiting discretionary purchases, but zealously saving pennies can also go too far. If you’re giving up every opportunity to see your favorite band in concert or trading all your vacation days for overtime, you may be overemphasizing savings. In the immortal words of Baloo, the wandering mentor of The Jungle Book, “If you act like that bee acts, no, you’re working too hard.”
Not planning for the future is irresponsible, but there is a point at which any hobby or project can get out of hand. Remember the big picture, and when you find yourself comparing certificate of deposit rates at twenty institutions, consider simply hiring a financial advisor. There are better ways to invest your time and money that allow you to enjoy life from now until retirement.