Essay on "Investing in Certificate of Deposits"

Essay 4 pages (1246 words) Sources: 5 Style: MLA

[EXCERPT] . . . .

COD Speech

Persuasive Speech: Why People Should invest in CODs

Unless you are lucky enough to be so wealthy -- or unlucky enough to be so poor -- that the economic changes of the past year and a half have not affected your budget or your plans, you are probably left with the dilemma of earning a living for today while trying to plan for your financial future. This recession has already been longer than any this country has faced other than the Great Depression, and though some analysts claim that it is finally coming to an end there are other signs that point to more hard times ahead (Gascon 2009; Rugaber 2009). This only makes the task of preparing for your economic future even more difficult and complicated than it usual. Of course, most of you probably have professional accountant working on the problem for you; perhaps you have a whole team of financial advisers just waiting to analyze your portfolio. In that case, sit back, relax, and let your money go to work for you. If you don't have this team of advisers, however, you might want to pay attention.

According to the latest available data, the job market is at its most competitive since the beginning of the recession (Rugbaer 2009). This also has the effect of driving wages down, which causes obvious complications when it comes to earning enough money to live on (Rugbaer 2009). It also causes the somewhat less obvious but equally essential problem of making it more difficult to save money for the future -- for buying a house, for unseen expenses, and for retirement. The huge reduction in the value of real estate will take years to recover, and the resultant havoc this has wreaked in the financial industry means that other areas of investment have become equally uncertain (Gascon 2009). It is clear that another way of investing for your future is needed, and as luck would have it one is available.

I am not here to tell you about a bridge I have for sale -- in fact, I am not trying to sell anything. I'm here to let you know about a certain type of investment with no risk to your capital and a guaranteed rate of return. Almost every bank offers these investment opportunities, known as certificates of deposit or CODs, which allow a bank to use the consumer's investment for a certain period of agreed-upon time while the consumer earns interest (Investopedia 2009). Like all bank accounts at legitimate financial institutions, CODs are insured by the Federal Deposit Insurance Commission, meaning that even if the bank fails the federal government will ensure that your capital (the initial amount invested) is returned. Though CODs do not have returns that are as impressive as most stock portfolios, they are also far less risky; looking at stocks and CODs over the past two years shows that CODs are clearly the better choice in uncertain economic times (McKay 2009).

It is true that in most scenarios, stocks and bonds will grow your money faster, but there is no protection and no guarantee of success. Both exist with a COD, and in a matter of years your money can earn thousands of dollars, as long as you save it wisely and invest in a COD. Though some see it as a detraction, one of the true benefits of a certificate of deposit account is that you are forced to save -- the guaranteed interest rate the bank offers comes with a guarantee that they can continue to use your money to fund investments for a certain period of time (Kennon 2009). You can always get it out if you really need to, with some penalties,… READ MORE

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