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How a CD ladder works. Let’s say you have $30,000 to invest in a high-yield CD. You might put the entire lump sum into a long-term CD of 12 months or longer to earn a high rate of return.
CD laddering is arguably the most common CD investing approach. For example, let’s say you have $6,000 you plan to invest in CDs. Here’s how a ladder might look: $2,000 in a 1-year CD.
When the first CD matures after a year, you can continue to build your ladder by reinvesting the funds in a new CD. Then, when the two-year CD matures, use the proceeds from that account to open a ...
A CD ladder is a great way to spread CD maturities out over time with different terms of CDs. Traditionally, in your typical ladder, five-year CDs have a higher yield than one-year CDs.
A CD ladder is a savings strategy that takes advantage of the benefits of short-, mid- and long-term CDs. Building a CD ladder involves opening several CDs of varying lengths and staggering the ...
Instead, consider building a CD ladder that contains a mix of terms — while the short- and medium-term CDs provide regular access to portions of your money, longer-term CDs give you more time to ...
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Data Source: The Ascent's Top CD Rate Page. Pre-Fed rates are from Aug 20, 2024, and current interest rates are from Oct. 16, 2024. Excludes brokered CDs.