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Don't Go Long

For fixed-income investors, low interest rates make short-term CDs the best choice.

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This story appears in the September 2004 issue of Entrepreneur. Subscribe »

Puny interest rates might be great for borrowers, but they're not good for fixed-income investors. Years of skimpy rates have made life hard for those who rely on interest-bearing investments to fund their retirements or their kids' educations.

Investors with long-term CDs coming due may be in the trickiest situation of all. A five-year CD locked in during the summer of 1999, for example, has been paying considerably more in interest than a comparable investment bought today will yield. So what's an investor to do with the money once that CD rolls over?

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