# Savings and CD Calculator/CD Ladder Calculator

**Certificate of Deposit CD Calculator** - Use this CD calculator to examine the benefits of investing and savings in a series of Certificates of Deposits with different maturities, also called a CD Laddering.

With a CD Ladder, you can benefit from higher interest rates for longer maturities, while achieving better liquidity and maintaining certificates of deposit that are within FDIC insurance limits.

## Certificate of Deposit - CD Ladder Calculator - Definitions

Use this CD Calculator to Maximize Earnings while balancing your Risk and Rewards. The advantage of Certificate of deposit ladder - CD Ladder - is that you lower your risk and increase your return without losing access to at least some of your cash. If you have saved a large amount of cash you want to invest in Certificates of deposit or CDs, then CD laddering is a good option to grow and protect your savings.

You start the CD ladder by buying several Certificates of deposit or CDs at the same time, each with a different maturity date. For example, you can select maturities of 3 months, 6 months, 9 months and 1 year, if you want access to a portion of your cash every 3 months. Each Certificate of deposit is like a rung on a ladder - hence CD Laddering.

As the Certificates of deposit mature, you renew each with a maturity of one year, locking in the new CD for a longer term at a higher interest rate thereby protecting you from interest rate fluctuations. Since FDIC insurance limit has permanently been raised to $250,000, if you have deposits in excess of $250,000 you may want to consider using multiple banks (not branches) so that each Certificate of deposit or CD is within the FDIC limit.

**Total to invest - **This is the total amount to invest in your **CD Ladder**.

**Frequency of Maturing Certificates of deposit or CDs - **How often you would like to have a Certificate of deposit or CD maturing. For example, if you choose six months, one of your Certificate of deposits or CDs in your CD ladder will mature every six months.

**Amount in each Certificate of deposit or CD - **How much you wish to invest in each Certificate of deposit or CD in your ladder. We use this amount to calculate the number of Certificates of deposit or CDs in the ladder. If the amount that you enter isn't evenly divisible by the total you wish to put into your CD Ladder, we will automatically adjust it up to an evenly divisible amount.

**Certificates of deposit in your CD Ladder** - The number of Certificates of deposit or CDs that will be in your CD ladder. Each Certificate of deposit or CD will have a different maturity, so that one of your Certificates of deposit or CDs will mature at the frequency you specify. This CD calculator assumes that you rollover all matured Certificates of deposit or CDs into new CDs that have a term of the longest maturity in your original CD ladder.

**Interest is compounded - **Interest earned on your Certificate of deposit or CD's accumulated interest. This **CD Ladder calculator** allows you to choose the frequency that your Certificate of deposit or CD's interest income is added to your account. The more frequently this occurs, the sooner your accumulated interest income will generate additional interest. You may wish to check with your local bank office to find out how often interest is being compounded on your particular Certificate of deposit or CD.