BERKELEY HEIGHTS, N.J. (TheStreet) -- The Federal Reserve's monetary policy is to keep interest rates extremely low to stimulate the economy. How low are interest rates as a result of decisions at Ben Bernanke's Fed? The average taxable money market fund pays 0.02% and two-year U.S. Treasurys yield a miniscule 0.34%. So a $1 million portfolio invested in two-year Treasurys today would generate roughly $3,400 in annual income. Even worse, those yields are pretax, so the net yield to an investor is even lower.Making a few simple tweaks can yield a much better income stream on that same $1 million portfolio, though as always extra return comes with additional investment risk.
|Federal Reserve Chairman Ben Bernanke and policies at the Fed have kept interest rates -- and yields -- low on Treasurys and cash.|