Making the Most of your Money- Stacking CD’s (Certificate of Deposit)

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If you have diligently saved your money into a savings account, have you ever thought of making your money stretch just a little bit further? Have you ever thought about opening up a CD (Certificate of Deposit) to get a better interest rate? How about stacking your CD’s? You won’t have the risk of the stock market, but you will still have a higher interest rate than a basic saving/checking account.
I highly suggest keeping a certain amount of money in your savings account for immediate access in case of an emergency. Enough to cover immediate expenses…..we’ll just say $5000. Every family will have a different amount. Why not take any other amount over that $5000 and make a little more money on from a higher interest rate?
Take this scenario:
Family “X” has $10,000 in their savings account.
Leave $5,000 in your savings account.
Take the other $5000 and “stack” it in CD’s. What I mean is open 5 separate CD’s ($1000 each) and open a 1 yr., 2 yr., 3 yr., 4 yr., & 5 yr. CD’s. Why the different years- won’t I have a lower interest rate for the smaller CD’s? The answer is yes you will- for the first maturity date. What you do is when your first CD matures, automatically open a new 5 year CD so you will get the highest interest rate possible. When the 2nd CD matures, automatically open another 5 year CD, etc. etc. What will end up happening is you will have 1 CD maturing every single year at the highest possible interest rate. When they mature don’t cash out- just keep opening a new one.
 I just did something similar to this and actually stacked them to mature every 6 months. I know some people have them maturing as little as every 3 months! Different banks require different minimums to open CD’s. If you don’t have $1000 to start a CD from your savings look for a CD that you can open for $100. Start small and add CD’s as you have the money. Shop around at the different banks in your area for the best interest rates!

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  1. Bethany K. says:

    Aloha! I found you on today's blog hop. I am about to start my student teaching this Spring to become a elementary school teacher and your blog caught my eye. I also worked at a bank before and I do remember some of my customers stack cds just like you suggested (using it to save for their child's college fund).

    You can find me at 🙂 Have an awesome week!

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