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5 Year Investment
Old 01-25-2012, 03:51 PM   #1
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5 Year Investment

Good afternoon, everyone.

The DW and I have about $25k in one of our general savings accounts that will be going towards purchasing a house in the next 5-10 years. Over the last few days, I've been considering moving a large portion of it ($15-$20K) into a CD.

With the news from the Fed this morning and some advice from an uncle who works in investing, he suggested that I scrap the CD idea and go with the Lord Abbett Short Duration Income Fund (LALDX):
https://www.lordabbett.com/advisor/m...rtdurationinc/

As I'm a relative novice when it comes to investing, I wanted to get everyone's opinion on the idea of investing in this type of fund over a 5-10 year span as well as get anyones opinion who actually owns this fund.

Kyle.
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Old 01-26-2012, 06:21 AM   #2
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Quote:
Originally Posted by SDCAKMenig View Post
Good afternoon, everyone.

The DW and I have about $25k in one of our general savings accounts that will be going towards purchasing a house in the next 5-10 years. Over the last few days, I've been considering moving a large portion of it ($15-$20K) into a CD.

With the news from the Fed this morning and some advice from an uncle who works in investing, he suggested that I scrap the CD idea and go with the Lord Abbett Short Duration Income Fund (LALDX):
https://www.lordabbett.com/advisor/m...rtdurationinc/

As I'm a relative novice when it comes to investing, I wanted to get everyone's opinion on the idea of investing in this type of fund over a 5-10 year span as well as get anyones opinion who actually owns this fund.

Kyle.
If you have definite short term plans for this money I'd emphasize safety and protecting principal......so CDs sound good. But you mention a 5 to 10 year time frame so I'd suggest something that will protect principal and keep up with inflation like an I-bond.

If you want to use a short term bon fund I'd avoid the one you link to as it has an expense ratio of 0.6%. Vanguard and Fidelity offer a range of short term bond funds with lower fees like VBIRX and VFSTX.
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Old 01-26-2012, 07:09 PM   #3
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Tend to agree with nun. VFSTX is VFSUX in slightly higher yielding Admiral class.
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Old 01-26-2012, 09:17 PM   #4
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I agree with CDs for target purchases in 10 years or less.
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