Had a chat with a retiree at the bank that changed my mind about brokerage accounts

I was at my local credit union in Cleveland last Tuesday waiting in line, and this older gentleman started talking about his savings. He said he's been with the same bank for 37 years and never touched a brokerage because he doesn't trust the stock market. I've always been pretty pro-broker for long term growth, but he brought up something I never thought about. He said his bank CD ladder gives him exactly 4.2% guaranteed right now, and he knows he'll never lose principal. That hit different because I've been chasing returns and taking losses on trades this year. He asked me how much sleep I lose over my portfolio, and I couldn't really answer. Has anyone else had a conversation that made you question your whole approach to where you park your money?

2 comments

2 Comments

davis.dakota4d ago

That "how much sleep do you lose" question really stuck with me too. But the thing is, a CD ladder locks you in just as much as stocks do, just in a different way.

lisa_hill233d ago

My 5-year CD from Navy Federal got an early withdrawal penalty of only 6 months interest, so I wouldn't call that locked in. If rates jump, I pay a small fee and I'm out. Try doing that with stocks when the market drops 20% and you need cash. How do you get out of a stock position without taking the loss?