Cash is Americans' Preferred Long-Term Investment
NEW YORK, July 29, 2013
NEW YORK, July 29, 2013 /PRNewswire/ --Investors' risk aversion even applies
over long investment horizons, with Americans most commonly saying that cash
investments are the best way to invest money not needed for more than 10
years, according to a new Bankrate.com (NYSE: RATE) report.
More than one in four Americans (26%) favor cash, edging out real estate
(23%). One in six (16%) favor gold or other precious metals, even though those
investments have been pummeled in 2013, while only 14% say stocks would be
their choice. Just eight percent of Americans chose bonds.
"Americans not saving enough is well-documented, but hunkering down in cash
investments and settling for low returns will only magnify the problem of not
having a sufficient nest egg to meet longer-range financial goals such as
retirement," said Greg McBride, CFA, Bankrate.com's senior financial analyst.
"Other choices may not do the trick either, as real estate is not only very
cash-intensive, but often illiquid. And precious metals spit out zero cash
flows, with gains solely dependent on price appreciation."
According to Bankrate.com, the average money-market deposit account yields
just 0.11%, so a $10,000 initial investment would only gain $110.55 over a
10-year period. And the average five-year CD currently yields just 0.78%.
The Bankrate.com Financial Security Index is down slightly in July from last
month's record, from 102.7 to 102.0. However, this is still the second-highest
level on record (dating back to Dec. 2010).
Americans continue to exhibit positive feelings concerning four of the five
components of financial security – job security, debt, net worth and overall
financial situation – with savings as the laggard.
Net worth continues to improve, mainly due to the housing market, but also
somewhat thanks to the stock market. Those reporting higher net worth compared
to one year ago (29%) outnumber those reporting lower net worth (16%) by
nearly two to one.
The survey was conducted by Princeton Survey Research Associates International
(PSRAI) and can be seen in its entirety here:
PSRAI obtained telephone interviews with a nationally representative sample of
1,005 adults living in the continental United States. Interviews were
conducted by landline (503) and cell phone (502, including 258 without a
landline phone) in English by Princeton Data Source from July 3-7, 2013.
Statistical results are weighted to correct known demographic discrepancies.
The margin of sampling error for the complete set of weighted data is plus or
minus 3.6 percentage points.
About Bankrate, Inc.
Bankrate is a leading publisher, aggregator, and distributor of personal
finance content on the Internet. Bankrate provides consumers with proprietary,
fully researched, comprehensive, independent and objective personal finance
editorial content across multiple vertical categories including mortgages,
deposits, insurance, credit cards, and other categories, such as retirement,
automobile loans, and taxes. The Bankrate network includes Bankrate.com, our
flagship website, and other owned and operated personal finance websites,
including CreditCards.com, Interest.com, Bankaholic.com, Mortgage-calc.com,
CreditCardGuide.com, Nationwide Card Services, InsuranceQuotes.com,
CarInsuranceQuotes.com, InsureMe, Bankrate.com.cn, CreditCards.ca,
NetQuote.com, and CD.com.Bankrate aggregates rate information from over 4,800
institutions on more than 300 financial products. With coverage of nearly 600
local markets in all 50 U.S. states, Bankrate generates over 172,000 distinct
rate tables capturing on average over three million pieces of information
daily.Bankrate develops and provides web services to over 80 co-branded
websites with online partners, including some of the most trusted and
frequently visited personal finance sites on the Internet such as Yahoo!, AOL,
CNBC, and Bloomberg. In addition, Bankrate licenses editorial content to over
500 newspapers on a daily basis including The Wall Street Journal, USA Today,
The New York Times, The Los Angeles Times, and The Boston Globe.
For more information:
Public Relations Manager
SOURCE Bankrate, Inc.
Press spacebar to pause and continue. Press esc to stop.