Oh my goodness. Did not anticipate or see coming reactions to my earlier post. Was only trying to offer a heads up regarding the date anomaly of the September FOMC meeting and the rules of the Bellco CD. Nothing more. Specifically:
While Bellco is fine by me and has treated me OK, I am surely not suggesting or recommending their CD products in general. Neither was I promoting index CDs in any way. The Bellco Index Advantage CD in particular has not even been available for (very roughly) one year! My post was intended to inform existing owners of this CD.
All of that said, I will now diverge from my original topic to say:
I have researched index CDs a bit. I would not touch most of them with a ten foot pole!
The Bellco Index Advantage CD, back when it was available in 2017, I viewed differently. I even searched for other similar index CDs back then . . . and found none! This was much to my disappointment.
The key with the Bellco product was that it is indexed to the Federal funds rate. I thought back then interest rates would increase. I knew if I were right that the interest rate on my Bellco CD would also rise. This has worked out really well. If the anticipated additional 2018 Fed rate increases materialize, my CD’s interest rate will jump to 3.7% APY. That is not Sharonview. But I can live with 3.7% considering I originally invested the funds back during the first half of 2017.
So why the negative comment about index CDs generally? Well, it all depends on the index basis. I have no clue about the future of the stock market or the price of gold or other such bases for the variety of index CDs out there. I did believe, over a year ago, that interest rates would rise; and I was willing to roll the dice on that belief alone. And bear in mind that if interest rates turn around and fall, so will the return on my Bellco Index Advantage CD. But they started me out at 2.45% APY which was a decent return last year. So I decided to take my chances. However I’m certainly not suggesting anyone else do the same . . . . unless you possess insight I do not have.