Earn More With a Certificate Laddering Strategy

couple snuggled up together looking at smartphone

Hanscom FCU’s certificate accounts are a smart and safe way to reach your savings goals while letting you earn a great rate. However, you can earn even more when you use a laddering strategy with your certificates.

A laddering strategy simply means putting your money in multiple certificates that mature at different times instead of putting all your money in a single certificate that matures at one time. When interest rates are climbing, a certificate ladder lets you take advantage of rising rates. You can take your maturing certificates and reinvest them into new certificates that are earning a higher dividend rate.

And if interest rates happen to fall, you’re still safe because you still have money locked into certificates with higher rates. This laddering strategy also gives you more availability with your funds if you need them because you’ll always have a certificate maturing on a regular schedule.

Here’s how it works: Let’s say you have $10,000 of long-term savings. Instead of pouring it all into a single 60-month certificate, with a laddering strategy you could put $2,000 into five separate certificates: a 60-month, a 48-month, a 36-month, a 24-month, and a 12-month. When your 12-month certificate matures, you roll it into a new 60-month certificate account, and repeat the process as each of the other four certificates matures.

Hanscom FCU can help you climb a little faster toward your financial goals with our great rates on certificates. Open a certificate online, call us at 800-656-4328, or stop by one of our branches to get a leg up on your savings today.

Open a Certificate Today!

Others are reading:

Unexpected Early Retirement? How to Protect Your Financial Future
What You Need to Know About Putting Your Home in a Trust

About Author

Default Author Image
MoneyWisdom Newsletter

Related Posts
How to Help a Victim of Identity Theft
How to Help a Victim of Identity Theft
6 Tips for Better Password Protection
6 Tips for Better Password Protection
Emergency Savings Accounts: 5 Places to Stash Your Cash
Emergency Savings Accounts: 5 Places to Stash Your Cash

Comment

Subscribe To Blog

Subscribe to Email Updates