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Where to Find Interest Rates of 1% to 12% Thumbnail

Where to Find Interest Rates of 1% to 12%

Dear Sandbox Clients and Friends,

This is a very challenging investment environment with inflation reaching a 41-year high, a reactionary Federal Reserve who continues to aggressively raise interest rates and the uncertainty of a recession headed into 2023.

The good news is that there are now places to invest for yield, as higher interest rates have started to show in many investment structures. Money Market Funds at our two custodians (Fidelity and Schwab) are now accruing at a rate at or over 1.0%.  For some clients, we have started to purchase (and roll into higher interest paying) short-term FDIC insured CDs and U.S. Treasuries. 

Please contact your Sandbox Financial advisor to review any of the concepts or ideas we outline below.  Note that the details below are not recommendations but rather informational only to illustrate potential investment options for interest and yield in today’s marketplace. 

Purchased by YOU, outside of Sandbox


1.    Series I Bonds

  •  Issued by the U.S. Treasury, must be purchased directly via www.TreasuryDirect.gov
  • Amount: $10,000 limit per owner, per year
  • Interest Rate: 9.62%, resets every 6 months
  • Holding Period: 1-year minimum ownership period; if redeemed before 5 years, then forfeit interest from the previous 3 months
  • Details: Interest earnings subject to Federal income tax but exempt from State taxes. Bonds are backed by the full faith and credit of the United States Government.
  • Risk Level:  Conservative + Income 


Purchased by Sandbox (via Fidelity or Schwab)


1.    Certificates of Deposits (CD)

  • Amount: $1,000 minimum denomination
  • Interest Rate: 1.5% to 3.0% +
  • Holding Period: 1-month, 3-month, and 6-month; longer durations also available depending on market and client circumstances
  • Details: FDIC-insured fixed rate debt instrument that offers incremental yield over a specified period of time that offers savers an attractive option who wish to earn more on their cash than what a savings/checking/money market account will offer
  • Risk Level:  Conservative + Income

2.    U.S Treasury Bonds

  • Amount: $1,000 minimum denomination
  • Interest Rate: 2.0% to 3.0% +
  • Holding Period: 1-month, 3-month, 6-month, 12-month, 2-year, 5-year, and 10-year
  • Details: Interest earnings subject to Federal income tax but exempt from State taxes. Treasury bonds are the most liquid debt instrument in the world, and they are backed by the full faith and credit of the United States Government.
  • Risk Level:  Conservative + Income 

3.    Structured Income Notes

  • Amount: $1,000 minimum denomination
  • Interest Rate: 8.0% to 12.0%, subject to market conditions (10-yr US Treasury yield, VIX index level, % discount of Zero-Coupon Bonds)
  •  Holding Period: ~ 5-6 year maturity, subject to early call provisions by the issuer/underwriting bank
  • Details: structured products are designed to be fixed income replacement that pay a premium yield to prevailing bond instruments, however the instrument is subject to market, credit, and liquidity risks
  • Risk Level:  Moderate + Income

4.    Real Estate Investments (via a fund)

  • Amount: $1,000 to $2,500 (depending on the fund manager)
  • Interest Rate: 4.0% to 6.0%
  • Holding Period: Daily for mutual funds, exchange-traded funds, and closed-end funds; quarterly or annually for evergreen funds and private placement offerings via a subscription document
  • Details: Hire a respected investment manager who oversees a portfolio of underlying investments in real estate (equity, REITs, leveraged funds to name a few) 
  • Risk Level:  Moderate + Income + Growth

5.    Call Writing Strategies (via a fund)

  • Amount: $1,000 to $2,500 (depending on the fund manager)
  • Interest Rate: 6.0% to 9.0%
  • Holding Period: Daily for mutual funds, exchange-traded funds, and closed-end funds
  • Details: An options trading strategy designed to generate income from selling call options on the same underlying stock also owned, which will limit the investor’s potential upside profit but improve portfolio performance by generating cash flows in a sideways or slowly rising equity market
  • Risk Level:  Aggressive + Income + Growth

6.    Dividend-Focused Equities

  • Amount: $1,000 minimum denomination
  • Interest Rate: 2.5% to 4.0%+
  • Holding Period: Daily liquid for stocks, mutual funds, exchange-traded funds, and closed-end funds
  • Details: Dividend growers (“aristocrats”) are equity investments in public companies that are generally larger and more established businesses who demonstrate an ability to consistently grow their profit margins and dividends in both good times and bad. This investment in a publicly traded company is achieved through common stock so market price risk and volatility are key considerations as well.
  • Risk Level:  Aggressive + Income + Growth

7.    Traditional Bonds

  • Corporate Bonds, Municipal Bonds, Preferred Securities, etc. now also have higher interest rates but remain (in our opinion) unattractive due to interest rate sensitivity if rates continue to rise. Meaning the principal value of an investment may lose money as interest rates rise, so we are watching these options for now.

To learn more, contact your Sandbox Financial advisor TODAY

*Reminder that this post is for informational purposes only.