For advisers, who often charge little to no fee for managing a portion of a client account with such a small yield, it's a better deal if the client decides to go into the market. In the long run, it may be better for the client, too: A sluggish market can also represent a buying opportunity.
The decision to go to cash--even an insured cash product--shouldn't be made in panic or fear, says Joe Jennings, investment director for PNC Wealth Management in Baltimore. But it might make sense if the client sees it as part of a broader asset allocation strategy or has a large purchase, such as a home, in mind.
"The first order of importance is to understand what the client is trying to accomplish," says Jennings.
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