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Dec 28, 2009 2:27 pm

[quote=Moraen]You are misleading the client if you give that number, IMHO.  You make the assumption that rates will be the same the next 20 years.  Or 30, or 6931 and nine and a half months.

  In the current state of interest rates, it's a true statement.   Sadly, most people aren't proactive about doing something, anything productive with their money.  They need to be pushed.  They need to be motivated.    Telling someone that their current path will take thousands of years to double their money might cause them to actually do something.  No one here knows what the future will bring.  Sure interest rates will eventually go up, but inaction until then doesn't help their cause.[/quote]

Yes.  The current rates are that low.  To quote them that number and tell them they have a choice of doing something or doubling their money in that ridiculous amount of time is disingenuous. 

If someone were earning 2%, would you then quote that number?  What is the purpose of laddering fixed income?  To take advantage of when rates go up and to keep higher interest rates when they go down, correct?

What I am saying to you is NOT that you are not accurate NOW, just that it is misleading.  It was one of those things I couldn't stand at Jones.

I would be careful about it is all.

I think it is better to say, "If rates continue as they are, it will take 7000 years to double your money.  Is that likely?  No, but how long will it take to get a reasonable amount?  Could your money be better put to use elsewhere and still maintain a significant level of safety?"