CD Ladder Calculator

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The purpose of the CD Ladder Calculator is to help investors see how much money they can earn by using a CD Ladder investment strategy. To use this tool you will need to enter your initial deposit amount, the number of months the CD holds the deposit for, and the CD's interest rate. After entering these amounts you will see the results graphed. You will also get a print out of the total annual yield, the annual percentage yield, and the ending balance.

CD Ladder Calculator Overview

A certificate of deposit is basically a promise by a depositor to keep their money deposited for an extended period of time. In exchange for this promise the financial institution pays the depositor a higher interest rate. The most common maturity rates for CDs include three months, six months, one year and five years.

A CD Ladder is an investment strategy used by people who invest in CDs. Investors who use this strategy stagger their investments so that that at least one CD matures each year. This gives the investor the liquidity needed to take advantage of rising interest rates, while still being able to invest in the longest term CDs with the highest interest rates possible. This is one way to maximize the benefits of investing in CDs while minimizing the drawbacks of locking in your investment capital for an extended period of time.