Investment for higher yield?

Do you have an opinion on investing in Duke Energy’s “Premier Notes”? They are advertised in BetterInvesting Magazine as “an alternative for your short-term funds.” I realize there is risk in investing any funds in a non-insured type investment but the floating rate offered on these notes is certainly attractive for short-term funds, Thanks.

SAVAGE SAYS: Because you wrote to me, I know you are aware of how I feel about keeping “chicken money” safe! I haven’t reviewed these notes, but they are not guaranteed — and thus do not qualify as “chicken money.” Only Treasury bills, money market mutual funds, short-term bank CDs and bank money market deposit accounts fit in that category.

Yes, I know that they pay next to nothng these days — but at least you won’t lose money on them! If you are searching for yield, then don’t fool yourself. Make an analysis of how much of your savings you can afford to put at risk, and then at least give yourself a fair chance on the upside by purchasing an equity-income fund from a mutual fund company that has no commissions — Fidelity, T. Rowe Price, or Vanguard, for example. You’ll get a slightly higher yield, and some possibility of gains (as well as losses) and you’ll get daily liquidity. Knowing that the balance of your money is safe in “chicken money” bank accounts will let you sleep better with the slightly higher risk in equity-income funds for an appropriate portion of your investments.