My spouse and I recently purchased a rental property. We have about $40,000(US) that a recently deceased relative left us and we have decided to use it for our rental business to handle special assessments (the unit is a condo), repairs, upgrades, HOA dues and taxes when not rented, etc. I'd like the money to at least keep pace with inflation but don't want anything too risky.
Today our business bank sent us an offer for a 2.25% CD if we invest $25,000 for 1 year, or 2.0% of we invest $10,000 for a year. Recent trends in US inflation have been around 2%, so this seems close to keeping up with inflation. Are there better ways to keep up with inflation that have relatively low risk? Is there any reason we should avoid CDs?