I had $ 5,000 in a savings account at my local bank that I may not use for awhile?

Question:

Last week, I sat down with an asset mgr/stockbroker type person and they said I may want to put that $ 5,000 into a MMMF (money market mutual fund) with check writing privileges so that I it will earn more interest. So I did that..now I wonder "If the stock market should suddenly go Down, could I lose some of that $ 5,000 ? "
I am now concerned about losing some of my $ 5,000. if the stock market does badly.

Answer:
Here's my advice.

If you have $5000 sitting around that you don't need but that you don't want to take any chance with, then put it into a CD. Just because your money is with the bank in a MMMF doesn't mean it won't lose money - you're exactly right.

Interest rates are around 5-5.5% for 6 month CD's.

Good Luck :-)

Depends on the management of the money market fund. Not all of the fund is invested in stocks, let alone it is not invested in the entire stock market. Money market funds are typically also invested in bonds, T-bills and other investments other than stock.

Like "fetch" said... If its not in stocks you shouldn't worry to much, BUT ANYTHING to do with the stock market has the ability for increase or decrease. A short term bank CD would of been more appropriate for you, IF it was higher interest you wanted to make, but I say this because I am not getting a commission on selling you a mutual fund like your bank guy IS !!

WHY a banker would bug you about YOUR money and HOW you have it stored is odd. He definitely wanted some more money for himself. Do not be persuaded next time to purchase anything with money you want to keep liquid. Having $5000 just sitting around is a good thing and you should be proud of yourself for having it and not touching it!!

Happy Monday !

: )

NNNF usually have FIXED rates. The rates may fluctuate but shouldn;t go negative

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Northstar, take your $5,000 and put into a money market account with Umbrellabank.com or EmigrantDirect.com yielding 5.25% and 5.05% respectively. Why tie your money up in a fund (where there are certain to be expenses) when you can GUARANTEE over 5% in a bank account. I believe Umbrella bank even offers a debit card. This is the BEST answer. Sorry, folks.

I had $ 5,000 in a savings account at my local bank that I may not use for awhile?

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