Money Market Accounts' Average Yield Before and After Inflation¹
10-Year Period Ended June 30, 2013This chart is for illustrative purposes only and does not reflect the performance of any Franklin, Templeton or Mutual Series fund. Past performance does not guarantee future results.
In the current low-yield environment, it's not uncommon to see low interest rates on Money Market Accounts. Yet when we adjust for inflation, perceived safety could be costing you purchasing power.
Think about the emotional impact of the market declines of 2008. Many investors have tried to avoid repeating the pain of that loss and the anxiety of market volatility by moving their investments into perceived "safe" harbors and staying there. But there's a cost to avoiding all forms of risk.
Has a bias toward loss aversion been influencing your portfolio with regard to stocks? A focus on past losses can cloud your vision from seeing opportunities ahead. Sounds like a great subject for a conversation with your financial advisor.
1. Sources: Money Market Accounts' Average Yield: BanxQuote®. Copyright ©2013 BanxCorp. All rights reserved. BanxQuote® is a registered trademark and servicemark of BanxCorp. Inflation: Bureau of Labor Statistics. Inflation is represented by year-over-year changes of the Consumer Price Index (CPI) plotted on a monthly basis.
It is important to note that money market accounts are insured by the Federal Deposit Insurance Corporation (FDIC) for up to $250,000.
All investments involve risks, including possible loss of principal. Stock prices fluctuate, sometimes rapidly and dramatically, due to factors affecting individual companies, particular industries or sectors, or general market conditions. Investments by a fund in foreign securities also involve special risks, including currency fluctuations and economic as well as political uncertainty.
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