just put all my saving in CD

[jetblack3s]

i had raised about 8 grand for emergency fund, and i just throw it in a cd account for 7 month at a rate of 4.7%. i know i could get a better rate but i didn't thought it would be easier to just stay with my own bank. Now it is a bad investment? Should i have invest it in something else to make more money?

[criniit]

Well that all depends...If you want to have a more hands on approach to making money or a more passive way. A hands on approach would be to either invest in someone's business (not stocks but funding start ups) or starting a business of your own.

A passive approach with better ROI and for someone that is a newcomer to the stock market I would suggest mutual funds, now I know a lot of people hate them but I have money in several and each of them over the last 10 years has gotten an average return of 11-17% which is a lot higher, though a little bit more risky than a CD. But mutual fund is not that big of a risk. I would suggest looking into it if you are interested in paper investment.

Feel free to PM if you have any questions.

[kiddoso]

jetblack3s, since you indicated that the money is for emergency use (if god forbids you have to access it for broken car, hospital bills, etc.), you want the money to be liquid. No, you don't want to put the money in other people's business, your business, stocks, or mutual funds.

[BusinessAdviser]

Great observation, kiddoso. If this money is for emergency use, then you're making a wise decision by not investing in riskier opportunities. You should NOT be looking at the stock market, even in the form of mutual funds, but should be looking at CDs, savings accounts, etc. Even with these though, you need to be aware of the inflation risk affecting your options, as they have lower returns in exchange for their safety.

[rogercbryan]

4.7% on $8000 for 7 months is not bad at all. You also need to consider that too few people even have an emergency fund... Good for you!

[criniit]

Oh I'm sorry man, my bad...I didn't see the emergency fund part

[BOG]

It does no good for emergencies if it's in a CD. Also you get taxed twice for CDs that mature in under a year. You're going to get smacked with both income and capital gains tax.

[jetblack3s]

It does no good for emergencies if it's in a CD. Also you get taxed twice for CDs that mature in under a year. You're going to get smacked with both income and capital gains tax.

what does that mean? i am not going to touch those money unless something really big happen. i still have saving in my bank and couple cars. i don't get the tax part, how much will they tax out of my interest?