Do you have a savings strategy for your money?
David Sant, Chief Marketing Officer for Cyprus Credit Union, joined us to tell us more about one strategy called a Certificate Ladder.
A certificate ladder spreads cash equally across multiple certificates of deposit and ultimately allows you to take advantage of highest rates while freeing up portions of that money at short-term intervals.
Sant explained that when you use a Certificate Ladder, you will open your initial cd's with staggered maturity terms.
He gave us an example of investing $10,000 in five different certificates. Your initial investment would be as follows:
• $2,000 in a one-year CD
• $2,000 in a two-year CD
• $2,000 in a three-year CD
• $2,000 in a four-year CD
• $2,000 in a five-year CD
Then, Sant says as each certificate matures, you would reinvest each certificate plus interest into a 5 year certificate. After 4 years you would have a certificate maturing each year and all would be earning the highest amount of interest. You'll enjoy the highest dividends with increased liquidity.
You can find more about this and other financial tips at cypruscu.com.