Reinvesting money assets

Terry Says

Stocks and bonds remain a “good place to invest” — but only for money that has a longer term time horizon and for which you can afford some risk of loss, especially if you would need the money within a few years.  I hope that puts things in perspective.  I know many of my readers are retired, or close to retirement, and that a decline in the market would make a serious dent in their lifestyle, not to mention their mental health!

So I always suggest setting some money aside in “chicken money” investments –such as bank CDs, or money market funds, or Treasury bills.  That money has no risk of loss, is liquid (meaning you can always get it out quickly) and should let you sleep well while the money in the stock market has its ups and downs.  The only drawback to “chicken money” is that it doesn’t earn much interest.  But that’s the price you pay for peace of mind!