The value of your shares will change with market conditions. Generally, these long term investments aren't insured by the FDIC, guaranteed by, nor are they obligations of the issuing financial institution. Even without these guarantees, local governments are allowed to invest in Money Market Mutual Funds if they are registered under the Investment Company Act of 1940. Your portfolio must be limited to bonds, notes, certificates of indebtedness, treasury bills, or other securities, whose principal and interest are guaranteed by the federal government. The financial institution the local government has transferred money to for investing the Repos agrees to repurchase the securities at a future date for the principal amount invested plus interest earned.
Maturity can vary from overnight agreements to up to one year.
Certificates of Deposit Certificates of Deposit are time deposits that allow for flexibility in maturity, rates and deposits. Fixed maturities can range from 14 days to 20 years. Interest is calculated on a 365-day simple interest basis, or a 365 day basis. Interest rates are subject to market conditions, but the later the maturity you choose, the higher the rate you'll receive and the lesser the deposit you'll need to make. Significant penalties will be charged for early withdrawals.