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CD Ladder Calculator

Split your savings across CDs that mature a year apart, so some money comes free every year while most of it earns long-term rates.

Split $50,000 into 5 CDs of $10,000, maturing every year for 5 years. They average 3.92% APY at first; reinvest each one as it matures into a new 5-year CD and the whole ladder earns the 5-year rate, 3.90%, with money coming free every year.

In each CD
$10,000
Interest in the first year
$1,960
Average APY while you build it
3.92%
Once built, every CD earns the 5-year rate
3.90%
Download the schedule (CSV)
Your ladder: $50,000 across 5 CDs
CDAmountAPYInterest by maturityMatures with
1-year$10,0004.10%$410$10,410
2-year$10,0003.95%$806$10,806
3-year$10,0003.85%$1,200$11,200
4-year$10,0003.80%$1,609$11,609
5-year$10,0003.90%$2,108$12,108

A $50,000 five-year ladder at example rates: what each CD earns by maturity

CDAmountAPYInterest by maturity
1-year$10,0004.10%$410
2-year$10,0003.95%$806
3-year$10,0003.85%$1,200
4-year$10,0003.80%$1,609
5-year$10,0003.90%$2,108

How this calculator works

A ladder splits one sum evenly across CDs of different terms, here one to five years. Each year one CD matures; you reinvest it in a new CD at the longest term.

After the first cycle every CD is a long-term CD earning the long-term rate, yet one still matures every year, so you are never more than a year from some of your money without paying a penalty.

The average APY while you build it weights each CD's APY by the money in it.

What it assumes

  • The rates are examples: enter the APYs you are offered for each term. When long-term rates are below short-term ones, as happens, a ladder earns less than rolling one-year CDs.
  • Rates when you reinvest will differ from today's.
  • Interest before tax.

Questions people ask

What is a CD ladder?

Several CDs with staggered maturity dates, commonly one to five years apart. As each matures you reinvest it at the longest term, so you earn long-term rates while some money comes free every year.

Is a CD ladder a good idea?

It suits money you won't need all at once and want to lock in rates for: it balances rate and access. For money you may need any time, a high-yield savings account is simpler.

How many rungs should a CD ladder have?

Three to five is common. More rungs mean money comes free more often; the longest rung sets the rate the ladder earns once built.

What happens when a CD in the ladder matures?

Banks give a grace period, often around 7 to 10 days, to withdraw or change the CD before it renews automatically. Set a reminder so it doesn't roll into a lower rate.

Is my CD ladder insured?

At FDIC-insured banks and NCUA-insured credit unions, up to $250,000 per depositor, per institution, per ownership category, together with your other deposits there. Spreading rungs across banks can raise your coverage.

Terms explained

Related calculators

  • CD CalculatorWhat a certificate of deposit earns by maturity, and what you keep if you close it early and pay the penalty.
  • APY CalculatorTurn an interest rate and its compounding into APY, the annual percentage yield banks quote, and see what it earns.
  • FDIC Insurance CalculatorHow much of your money at one bank is FDIC insured, category by category: accounts in your name, joint accounts, IRAs and trust accounts.

Sources

Updated by the RateHerald team. The maths is tested against worked examples; report a problem.

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