Select the fidelity account in which you want to build your model cd ladder and enter the total amount you want to invest.
5 year cd ladder.
After four years all of your cds will be in five year cds earning the maximum amount of interest.
Choose a model cd ladder.
If you had 10 000 to invest you could spread out your money like this.
But remember that means your money is in the cd for the full 5 year term unless you withdraw it.
The cd ladder illustrated below was calculated using your initial deposit amount and today s rates.
Sample 5 year cd ladder.
Choose whether you want the maturing positions in your cd ladder to be returned to cash or use auto roll to automatically reinvest in new cds at the end of the ladder.
It s important to remember that rates are subject to change over time.
The five year five cd ladder this is the baseline cd ladder strategy we outlined above.
What is a cd ladder.
More about these products high yield cds.
If you decide to renew your cd the bank may do so automatically and roll it into another cd with the same term as the old one.
2 000 in a.
Each year you d take a step up the ladder until you finally reach the rung your money is on in 5 years.
How we make money.
1 year 2 year or 5 year.
Essentially a cd ladder is an investment strategy where you invest in a series of individual cds with staggered maturity dates.
Instead of locking all your money up by opening.
By using a cd ladder however you can get the higher rates that accompany longer terms while also reducing the risk that you ll need to liquidate a cd before it matures.
Once your cd matures you can renew it at the current rate withdraw your initial deposit along with the interest or both.
Five year cds are also a popular choice for cd ladder strategies.
A five year term may get you closer to 3.
You open up five cds with staggered term lengths so that one new cd comes due each year and then renew it into a five year cd.
Over these 5 years your money will have grown a lot the whole time you were climbing.
Build a cd ladder to grow your savings.
Get a certificate of deposit with our highest fixed cd rate for a fixed term.
The downside of course is that you are much more likely to liquidate a 5 year cd in an emergency losing money to the penalty most banks charge for early withdrawals.
