Saving certificates for income

I have been buying 182-day bank savings certificates with high interest. Are these okay for "quickie" investments with a good return? Should I get something else to avoid having all my eggs in one basket? V. S.

There nothing wrong with keeping your funds working as hard as they can. Recently the money-market certificates of deposit (CDs) from banks and savings and loans based on 26-week Treasury bills have been a good return with no risk because they are insured. The rate is still not up to inflation after paying taxes, but it is closer than some alternatives.

With rates on the decline, you might prefer to lock up some funds at the high rates for a longer period by buying income utility stocks or deep-discount bonds. These are not insured, but you can buy US Treasury long-term bonds at a discount or stick with AAA-rated corporate bonds for little risk. Diversifying investments is always a good plan. You might also stay liquid with some funds in the 26-week CDs and other funds in income stocks or bonds. Such a plan would not only lock up current returns for a longer period but could provide substantial long-term capital gains over a 1 1/2 to two- year period.

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