One of the great mysteries as an investment advisor is this. Why do so many people leave uninvested cash idle in low interest earning bank accounts for long periods of time when with that same bank account they can access the Treaury Direct system.. An ideal solution here is to buy US Treasuries direct. All one need do is visit www.publicdebt.treas.gov and print off a one page form, fill in no more than 8 boxes of information, attach a voided check to the form and mail it to the Federal Reserve Bank in your area. An added small kicker is that Treasuries are exempt for state tax purposes whereas you pay both federal and state tax on regular bank interest income.
Doing this allows you to get the same rate that large banks receive as Treasury bills and notes are regularly auctioned. Over the long haul you will always earn a higher rate than CD's given that banks generally take your short-term CD deposits and go right out into the market and purchase Treasuries direct for the same amount, pocketing a spread that ranges from .3 to 1.25 percent. You can effectively cut out the bank's spread by going direct and when you use a standard bank account their is no fee.
This is one example of the many small ways in which a good independent investment advisor can help make a difference in your portfolio.
Parish & Company is an independent fee based investment advisor to individuals, pensions and trusts based in Portland, Oregon.