Comments on: Our CD Ladder is Half Complete

By: The CD Ladder: A Different Way to Save | Prime Time Money

The CD Ladder: A Different Way to Save | Prime Time Money — Wed, 20 May 2009 10:01:33 +0000

[...] Our CD Ladder is Half Complete at No Debt Plan [...]

By: Russell Fascenda

Russell Fascenda — Mon, 24 Nov 2008 13:57:26 +0000

I had a CD ladder setup quite a few years ago, I kept three 6-month CDs on a cycle so one was matured every 2 months. When I ran into bad times they were my income. Philip, it’s a bit of a nuisance if you want to ADD funds at renewal time, which is what I did to keep increasing the amounts. But my bank automatically renews for another term if I don’t do anything.

In fact one of those three CDs survived (I didn’t need the funds) and it’s been renewed every 6 months for nearly 7 years now. Not only does it happen automatically, I can keep the same term. The local bank I used doesn’t offer 6-month CDs anymore, but because I’ve left that one intact they have allowed it to continue on the 6-month cycle.

One thing I’ve considered is getting longer-term CDs for the added interest rate. Typically the penalty for early withdrawal is to forfeit some or all of the interest earned. My thinking is why not have a better earning CD, and if a true emergency came along, I’d forfeit some interest to address my emergency.

By: ChristianPF

ChristianPF — Fri, 21 Nov 2008 20:00:09 +0000

I was just talking to my mom about this today. I feel terribly sheepish telling others what to do with their investments because I really don’t know what is going to happen. But, I do feel comfortable hanging on to my own and even purchasing more since prices are so low right now. If I am wrong for myself, I can handle it, but it is another thing to have my wrongness dramatically affect someone else’s financial life.

By: Kevin

Kevin — Fri, 21 Nov 2008 01:26:03 +0000

@Philip: It takes about 5 seconds to set one up, so I’m not concerned with the time involved.

Although I did see a “Setup CD Ladder” option, wonder how that works…

By: philip

philip — Thu, 20 Nov 2008 23:52:56 +0000

That sounds like too much effort to have to renew them every month, I know it is only 6 month, but you have to mess with one of them every month.

Do they auto renew if you don’t do anything else with them? that would help to automate things and might be bearable that way.

No, I don’t have any CDs at all, I am still paying off some debt before starting strong savings and my EF is not going into a CD

By: That One Caveman

That One Caveman — Thu, 20 Nov 2008 17:57:08 +0000

We haven’t set one up yet because the interest rate that I get at my credit union beats ING Direct’s CD rates right now. When our basement is finished and we have money to save again, I’ll look into building a 12-month ladder that will eventually grow into a 5-year.