The following is my
answer to a Quora question: “Is it worth putting money in an Ally
Bank 14-month CD, for 2.85%?”
When you put money in any investment, you should
consider the inflation rate in relation to the return on the investment. In this case, US inflation in 2018 was 1.8% to
2.0%. Inflation in 2019 and 2020 is not
expected to ease much due to inflationary pressures, but hold steady at 2.0%. In that light, if you can afford to put money in an
illiquid investment, meaning that you see no immediate need for the funds in
that period of time, it is a worthwhile option.
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