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Ask Dave

Certificate of Depression

Jeri finds out that certificates of deposit are not a secure investment and that she should get a better broker to help her invest in mutual funds.

QUESTION: Jeri is recently widowed and has $200,000 in investments that are not doing well. Should she move the money to a certificate of deposit, which gives her a guaranteed interest rate?

ANSWER: No, don’t do that. Certificate of deposits are not a secure investment. They average about 4% and that’s also the inflation rate. By the time you pay taxes, you’ll lose money. Get away from your broker if they are giving you information like this. Invest in good growth stock mutual funds that average about 12 percent. Put it in growth, growth and income, balanced and international.