Interest Rates Don’t Even Match The Rate Of Inflation!

It's been a long time since we saw interest rates at a decent level. If you are someone who has money to invest and wants to find something safe, you are probably at a loss of where to put it.

Investing in stocks is what most long term investors do and what most financial planners will advise. If you have money you won't need for 10 or 20 years, putting it in the stock market is okay because you have the time to ride out any rough patches. Even though the market may go down in the short term, history has shown that over the long term it will recover.

However, not everyone feels comfortable in stocks and not everyone has money they can afford to put away for 10 years or more. So, what does someone do with the savings they have and may need at any time?

Usually they would put it in Treasury bills, bank CD's, or even money market accounts that all earn interest and are guaranteed under FDIC up to $250,000. But if you have looked at interest rates lately, you might be asking yourself "when will interest rates go up?".

This is because right now and for the last couple of years, we have seen some of the lowest interest rates in our lifetime. It doesn't matter whether you are looking for the best money market interest rates, the best CD rates, or the best rates that Treasury bill pay because they are all incredibly low. They are so low that at one point last year, Treasurys were paying NOTHING in interest. That meant if you bought treasury bills at that time, you were loaning the money to the US government for free!

Anyone  who wants and need interest income for the money they want to keep safe is just out of luck right now. The best they can do is around 1% give or take a half percentage point. While that is better than nothing, it doesn't keep you even with the rate of inflation! These are difficult times financially for many indeed.

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