Thursday, August 6, 2009

Why Interest Rates Are So Low

By Stacy Tran

Money market and CD rates are very low right now. No matter how hard you look or where you look, you will not find any rates that will make you very happy. For someone who relies on interest income, this is a very tough time right now. Retired people usually fall into this category as the only two income sources most retirees have are Social Security and interest from their savings.

There is really no safe place for anyone to put their money and get a reasonable rate of return. Older people need to have their savings in something safer than the stock market because they might need the money at any time and they cannot afford the risk that comes with the stock market. It is true that they might not have to worry about losing a job like many folks do, but their income has taken a big hit too.

Retirees usually have most of their money in CDs and government bonds. This is because those rates are historically higher than those you get with a money market account. Most money market accounts will let you make periodic withdrawals and you can also take your money out at any time. This means you get a lower interest rate in a money market in exchange for the ability to always have access to your money.

People use money market accounts in conjunction with stock portfolios as a place to park their money that is not invested in stocks. If you are one of the lucky ones that has money to invest, right now you will not be finding rates that give you much in return. No matter how long you search the Internet, you will not find rate that are anywhere near what they were 3 or 4 years ago.

Anyone who is unhappy with these low interest rates and is willing to take more risk should look into something called social lending. With social lending, you are lending money to another person rather than a banking institution. There are several online websites that match lenders with people who need the money and are willing to pay a higher rate. There is more risk with this type of loan because the person could default on the loan. However, anyone wanting to find higher interest rates should look into social lending as a possible solution.

About the Author:

Why Interest Rates Are So Low

By Stacy Tran

No matter how hard you search for the best money market rates, you are not going to find anything very high right now. This is a bad time for someone who lives off a fixed income and relies on interest income for his or her survival. Retired people usually are the first ones you think of in this category, as their only two potential income sources are Social Security and investment income.

With interest rates so low, there is no safe place for retirees or anyone to put their money and make money. This is why retirees, in addition to everyone else, are also having a tough time in this atrocious economy. Older people should not have their money in the stock market because there is not enough safety. They need a place where they can park their money, not worry about losing it, and get something back in return.

The best money market interest rates are usually going to be lower than CD rates or government bonds. This is because the money you put in a money market account is not locked up like it is with a CD. Most money market accounts allow you to make periodic withdrawals and you can take all of it out at any time. This means you get a lower interest rate than some other investment vehicle like a CD where you agree to leave the money in for a predetermined length of time.

People use money market accounts in conjunction with stock portfolios as a place to park their money that is not invested in stocks. If you are one of the lucky ones that has money to invest, right now you will not be finding rates that give you much in return. No matter how long you search the Internet, you will not find rate that are anywhere near what they were 3 or 4 years ago.

If you want to take a little risk you can try something called social lending. With social lending, you are lending money to another person rather than a banking institution. You do this through the Internet and you will get a much better rate of return, usually upwards of 6%. There is more risk though, as there must be, because the person could default on the loan. It is worth looking into though, if you are willing to accept the added risk to get a better rate.

About the Author:

Low Interest Rates Hurt Those With Money

By Stacy Tran

Money market and CD rates are very low right now. No matter how hard you look or where you look, you will not find any rates that will make you very happy. For someone who relies on interest income, this is a very tough time right now. Retired people usually fall into this category as the only two income sources most retirees have are Social Security and interest from their savings.

There is really no safe place for anyone to put their money and get a reasonable rate of return. Older people need to have their savings in something safer than the stock market because they might need the money at any time and they cannot afford the risk that comes with the stock market. It is true that they might not have to worry about losing a job like many folks do, but their income has taken a big hit too.

CD and government bond interest rates are usually going to be higher than those of money market accounts. This is because the money you put in a money market account is not locked up like it is with a CD. Interest rates can depend somewhat on the time frame you agree to loan the money and with most money market accounts, you can make periodic withdrawals and you can take all of it out at any time. This means you get a lower interest rate than something like a CD where you agree to leave the money in for a predetermined length of time.

People use money market accounts in conjunction with stock portfolios as a place to park their money that is not invested in stocks. If you are one of the lucky ones that has money to invest, right now you will not be finding rates that give you much in return. No matter how long you search the Internet, you will not find rate that are anywhere near what they were 3 or 4 years ago.

If you want to take a little risk you can try something called social lending. With social lending, you are lending money to another person rather than a banking institution. You do this through the Internet and you will get a much better rate of return, usually upwards of 6%. There is more risk though, as there must be, because the person could default on the loan. It is worth looking into though, if you are willing to accept the added risk to get a better rate.

About the Author:

Why Interest Rates Are So Low

By Stacy Tran

No matter how hard you search for the best money market rates, you are not going to find anything very high right now. This is a bad time for someone who lives off a fixed income and relies on interest income for his or her survival. Retired people usually are the first ones you think of in this category, as their only two potential income sources are Social Security and investment income.

With CD interest rates and money market interest rates so low, there is really no safe place for retirees to put their money and get a reasonable rate of return. This is why retirees are also having a tough time in this atrocious economy. They don't have to worry about losing a job like many folks do but their income has taken a big hit too.

Retirees usually have most of their money in CDs and government bonds. This is because those rates are historically higher than those you get with a money market account. Most money market accounts will let you make periodic withdrawals and you can also take your money out at any time. This means you get a lower interest rate in a money market in exchange for the ability to always have access to your money.

Money market accounts are often used in conjunction with stock portfolios so that you can buy and sell stock and have the money go in and out of your money market account. No matter how long you search the Internet, you will not find one rate you are happy with. For someone who has some money and wants to invest it safely, you should be prepared to get little in return.

There is something called social lending that will give you a higher rate of return but it does come with some risk. With social lending, you are lending money to another person rather than a banking institution. This is done through the Internet and you might be able to get a rate of return of 6% or higher. In exchange for this higher rate you will be exposed to more risk as the person you loan your money to could default on the loan. Even with the risk, if you absolutely need to find a place where you can get a higher interest rate, this type of social lending is worth looking into.

About the Author:

RESPONSE REQUIRED: confirm unique article delivery address

Hi mike

You have just requested to have unique content articles delivered to this email address. If that is indeed the case, please click the link below to confirm the subscription. If you don't want to receive articles to this address, then simply discard this email.

Click here to confirm



At any time you can log in to your account at http://www.uniquearticlewizard.com/bloggers to change your article and account preferences.

If you have any questions please contact us at the helpdesk

Thanks,

Noel Swanson