Whether you're planning for retirement or just looking to safeguard 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 tracking surprisingly close to inflation. In other words, a portfolio with modest certificate of deposit rates may grow in dollars but not actual value. It's better than simply burying your money in a hole because 500 dollars will be worth significantly less in several decades. A bottle of coke that once cost a nickel may now cost a dollar or more, and it's not as though the ingredients have gotten much better.
By the time 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. Not only will inflation reduce the impact of any gains but also withdrawing money early will generally mean penalties. If you find yourself getting stressed by comparing all the details of different options, remember that some things in life are more important.
Investing Time, Not Just Money
If you spend two full weekends just comparing plans online and talking to investors, you have made a significant investment already. How many dollars an hour is your free time worth? Assuming you work a full-time job, those hours in the evening and on weekends are even more valuable. If you had to give yourself overtime pay for the hours you spent researching and comparing financial options, would the information you gained be worth that much money?
It's difficult to “invest” time in a way that seems worthwhile from an hourly wage perspective, but “saving” time is more intuitive. If you need a whole portfolio for managed funds, then why not hire a professional? They may charge a high hourly rate, but you're also getting the benefit of their years of training and experience.
Cultivating a Wealth of Experience
As any advisor will tell you, the best time to start saving is always now-the sooner, the better. But making money to set aside means either extra hours of labor or foregoing experiences in the short-term. Enough funds to invest can be set aside by small lifestyle adjustments like packing a lunch and limiting one's discretionary purchases, but zealously pinching pennies can also go too far. If you give up every opportunity to see your favorite band in concert or trade in all your vacation days for extra hours, then you may be over-emphasizing savings. In the immortal words of the Jungle Book's shiftless mentor Baloo, “If you act like that bee acts-nah, you workin' too hard.”
Failing to plan for the future is irresponsible, but there's 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 for enjoying life between now and retirement.