I haven't seen much, if any, discussion of CD laddering here. How do people feel about it? Good, bad, ugly, indifferent? I've been thinking of putting some of our cash in a CD ladder. It's currently languishing in a savings account yielding ~ 1%. There are some 5-year CDs out there yielding almost 2%. But I'm a little weary of the interest rate risk involved in tying up my money for 5 years. That's why I'm interested in CD laddering. Any thoughts?
Thanks, Bill
I thought there had been encyclopedias about ladders written here (avail in google group archives). Most of it rapturous about seemingly tiny advantages and disregarding of maintenance and complication.
For the next chapters of ladder-philia I would alos like to hear how they dispose of the idea of ladder etfs like PLW. Even if such etfs only give a portion of the benefit, they save 99% of the annoying upkeep.
I have quite a few CDs - what is this "upkeep" and "maintenance" that I am supposed to be doing to them?
On a ladder don't you have to remember and be present various times to roll things over? And maybe not the case for cds, but for the general case of bonds for the average Joe... wouldn't he need to research every waking moment of every day to even approach the safety of what you get from a diversified fund of bonds rather than picking individual ones for a ladder?
No, not at all. A month before each CD is due to roll over, they mail me a notice. If I don't respond, the CD automagically rolls over for the same term interval again, at the prevaling interest rate.
Read the thread title - the topic is "CD Laddering". Nothing to do with bonds.
that is a bad way to go. By shopping around rather than simply letting it roll over, you will likely be able to find better rates. Lots of the roll overs are gyps.
and, with a sufficiently large amount of CDs you are no longer in the realm of a single bank,and maybe even have moved to brokered CDs in a brokerage account. I don't know how these might be set up to roll over, but I wouldn't advise it.
I've some of that over at ALLY -
Still have our CDs over there, as they have lots of offerings... and even with longer term, you can still get out.
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