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Taking CD risk can be, yes, risky

Seniors have traditionally used safe, secure and high-yielding CDs to supplement their income. But with yields on savings vehicles near all-time lows, some older folks have been tempted to take some risk.

Many financial institutions offer "market-linked" CDs, which are tied to the performance of various assets such as stocks, bonds and even foreign currencies. The FDIC says these instruments are being aggressively sold to consumers, especially seniors. But the agency notes these CDs are not suitable for all investors because the returns are uncertain and the maturity can be as long as 20 years. While you'll at least get back your principal at maturity as long as the CD is FDIC-insured, you may get little or no interest if the assets the CDs are linked to go down.

The FDIC has more information in its spring newsletter. Go to

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