Life insurance for retirees? Income needs come first; Money-market CDs insured

Are the six-month certificates of deposit (CD) fully insured by the US federal government? Are they safe, no-risk investments? Would I be wiser to invest in passbook savings at less interest? --Anon.

Money-market CDs, sometimes referred to as T-bill Cds because their rate is determined by Treasury-bill auctions, are insured up to $100,000. The FDIC insures such CDs at member banks; the FSLIC insures similar CDs issued by member savings-and-loan associations. Money-market CDs are safe, but I question the no-risk portion of your inquiry, because loss of purchasing power can be just as much of a loss as loss of the dollars themselves. During these days of high short-term interest rates, the yields of six-month CDs are higher than the inflation rate before taxes. The after-tax return from the money-market CDs may still be negative relative to inflation for high-bracket taxpayers. You would not be better off to get out of money-market CDs and keep your money in passbook savings, because you would lose considerable interest and gain no additional protection