Laddering your Certificate Accounts is a cash management option that allows you to ultimately get long term rates while retaining access to a portion of your money.
The most popular laddering option has five Certificate Accounts in 1-year, 2-year, 3-year, 4-year, and 5-year terms. When each term matures it renews to the longest term of your ladder. After Five years, you have Five Certificate Accounts (and the 5-year rates) with one Certificate Account maturing every year.
| Example At Opening |
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1-year certificate account with $500 |
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2-year certificate account with $500 |
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3-year certificate account with $500 |
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4-year certificate account with $500 |
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5-year certificate account with $500 |
| Example After 1 Year |
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2-year certificate account with $500 maturing in 1 year |
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3-year certificate account with $500 maturing in 2 year |
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4-year certificate account with $500 maturing in 3 year |
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5-year certificate account with $500 maturing in 4 year |
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5-year certificate account with $500 maturing in 5 year |
| Example After 1 Year |
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5-year certificate account with $500 maturing in 1 year |
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5-year certificate account with $500 maturing in 2 year |
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5-year certificate account with $500 maturing in 3 year |
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5-year certificate account with $500 maturing in 4 year |
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5-year certificate account with $500 maturing in 5 year |
You can ladder your certificate accounts in different terms and different number of certificate accounts if you prefer. For example you could ladder 3-month, 6-month, and 9-month Certificate Accounts with the goal of getting consistent 9-month rates while retaining 3-month flexibility on a third of your money.
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