Over a 60-month period, you can boost your return on investment by up to
$-10,000.00
with laddering, compared to
$-10,000.00
by simply rolling over fixed-term, 12-month CDs. We've
outlined two different laddering strategies for you to choose from.
Conservative CD Ladder
Estimated value after 60 months:
$0.00
This ladder is structured so CDs mature at intervals of every
3 months. This will give you more frequent access to cash,
so your earnings will typically be somewhat less than the other
scenario, but greater than a simple rollover.
Moderate CD Ladder
Estimated value after 60 months:
$0.00
This ladder is structured so CDs mature at intervals of every
12 months. This will give you less frequent access to cash,
so your earnings will typically be higher than the other scenario.
What to do when your CDs mature:
Your first CD will expire after 3 or
12 months. At that time, you will need to reinvest the
proceeds in the longest term CD. Since there is no way to know exactly
where, or what, the best return will be at that time, we recommend that
you return to Bankrate.com to find the best returns or update your
ladder strategy.
* An asterisk means that CDs of this maturity may be hard to find, but
Bankrate.com has a few suggestions. Consider holding more cash in a
high-yielding money market account
so that you don't need access to your CDs as frequently. You will earn
higher returns in your CD ladder with less frequent access, while
earning competitive yields in a fully liquid money market account. You
may also wish to ask the other institutions you've purchased CDs from if
they offer odd maturity CDs such as this.
