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Here’s an example of how to set up a CD ladder. Let’s say you want to build a five-year CD ladder with five rungs. If you have $2,500 to invest, then you might divide the funds equally into ...
A CD ladder is a strategy that involves dividing a sum of money into multiple different CDs at staggering maturity dates rather than putting all of the money into one.
Building a CD ladder involves buying multiple CDs that mature at different times. For example, you might buy a 1-year CD, 2-year CD, 3-year CD, 4-year CD, and a 5-year CD.
Build a CD ladder into your strategy. CD laddering is where you divide your money across CDs with different term lengths so they expire — and pay out — on a rolling basis. As each term comes ...
In two years, your CD ladder earns a total of $252.83 in interest. That's a return of 5.06% on your $5,000. CD ladders like this work well, because they get you the benefits of CDs while ...
Each CD becomes a “rung” on your CD ladder, with the ladder itself offering an overall yield. Here’s an example of a two-year CD ladder of six rungs: 2-year CD ladder
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Data source: Author's calculations. All told, you're looking at $501 in interest with a $10,000 CD ladder if you open CDs with these terms and APYs. But shop around for the best rates you can find ...