CD ladder

Commit to your savings goals with a CD laddering strategy.

Budgeting and planning
March 04, 2020

Certificates of deposit can be a helpful tool to grow your savings. Rates are locked in for a set period of time and you know exactly what the rate is.

A CD ladder is made of separate CDs that are staggered so they mature at different times. This gives you the ability to earn a higher rate of return, while still giving you periodic access to a portion of your savings.

Here are some benefits of a CD ladder and how to set one up.

Man sitting with women reviewing the CD ladder benefits

CD ladder benefits

  • Earn a higher APY (annual percentage yield) than is typical for other savings account types.
  • Retain access to a portion of your savings fund at specific time intervals, without the risk of paying early withdrawal fees.
  • When CD rates go up, you’ll have opportunities to renew your CDs at a higher rate more often.
Red graph displaying how a CD ladder could look using staggered terms

How to build a CD ladder

  • Decide how often you want access to the funds. For example, do you want the ability to use the money (if needed) every 3 months, 6 months, or once each year?
  • Split up the total amount of money you want to save into different CD accounts with staggered terms.
    • Let’s say you have $4,000 to put into a CD. You only want access to the funds once each year. Instead of putting it into one CD, you divide it up and put $1,000 each into a 4-year term, 3-year term, a 2-year term and a 1-year term.
    • Note: $500 minimum opening deposit.
  • When the first CD matures after one year, put it into a longer-term CD (in this case, a 4-year term). When the second one matures, do the same (again, for our example, a 4-year term), and the same for the third.
  • Now your CD ladder is built, with longer terms that typically mean higher CD rates. Each year, one of your four CDs will mature, so the funds will be accessible if you need them. You’ll get a letter informing you of the CD’s maturity date, so you can stop by your branch and see the rates and terms that best fit your needs, and continue your CD ladder if it still makes the most sense for you.


  • Just like when you leave the dentist, when you leave the branch after renewing your CD, mark your calendar with your CD maturity date—like for a checkup.
  • Set up alerts if possible.
  • You can enroll in digital banking and see your CD balance, term, interest earned, date of maturity and more.
  • If you don’t visit a branch and take action on your maturing CD within the 7-day grace period, your CD will renew for the same at the current standard CD rate. It’s particularly important to visit a branch during this time period to learn about your renewal options.
  • APYs and interest rates are subject to change. Different products have different terms and fees, so you should always research and compare current rates to make the best decision for you.

Please note that CDs are subject to early withdrawal penalties.

Also, the information above is for informational purposes only and does not constitute financial advice. It should not replace a financial advisor or planner. The information provided is general and does not apply to individual financial situations or needs.

Learn more about CDs, terms, and rates.

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