Saving money and IRA question. Does this make sense?

yes that makes perfect sense.

Find out if the firm will charge an account maintence fee... those fees can really eat away your cd return.

open the business section of your local newspaper and compare cd rates... go to the bank with higherst NET return (%cd return -ira fee) and keep the money there.

people will say you should take more chances and make more... but it sounds like you know your tolerance better than most so ignore them... stick to cd's.. inside an ira the return will be tax free until you withdraw.... also compare it to a roth and see which makes more sense for your income level.

good luck

A traditional IRA is set up so the everyday man can place a certain sum on money into an IRA, then deduct from taxes later. There is little risk depending on the mutual fund it's placed in.

An IRA is supposed to be for the long-run and almost every mutual fund ever created has produced some net gain - however, some have gained more than others in the long run.

With CDs, you pay a fairly hefty tax immediately since you are collecting on the interest.

Look a larger mutual fund firm (CS, Fidelity) and something with a morningstar rating of 3 or higher in a 5-year index. That's pretty much a guaranteed return for the future.