Long CD Ladder Example Page

Establishing a Long Term Savings Plan with a CD Ladder

Looking for a safe way to accelerate your long-term savings? Perhaps you're thinking about your retirement savings strategy. You want to earn more than regular savings accounts offer, but don't want your money tied up in case rates increase or an unexpected need arises. The CD Ladder offers many options that can help you make the most of this situation.

For example, Dollar Bank can open three CDs for you with terms of 12, 24 and 36 months. Each of these CDs will earn interest at its current rate, creating a blended rate that is higher than the shortest CD in your ladder. So you start earning more on your entire balance from the very first day your CD Ladder is open.

Following is a timeline of the 3/12 CD Ladder with an Extend renewal option.

Please note: rates shown below are examples only. For our current rates, click Today's Rates on the right-hand side.

  September 2014 1.00% APY   1.50% APY   2.00% APY Bracket Blended rate*
1.50%
  12 months   24 months   36 months
  arrow   arrow   arrow  
September 2015 2.00% APY   Bracket Blended rate*
1.83%
  36 months   Hourglass with
12 months
remaining
  Hourglass with
24 months
remaining
  arrow   arrow   arrow  
September 2016   2.00% APY   Bracket Blended rate*
2.00%
  Hourglass with
24 months
remaining
  36 months   Hourglass with
12 months
remaining
  arrow   arrow   arrow  
September 2017   2.00% APY  
  Hourglass with
12 months
remaining
  Hourglass with
24 months
remaining
  36 months
  arrow   arrow   arrow  
 
At this point the full benefits of your CD Ladder will continue providing high returns as well as access to your savings every 12 months.

 


One year after your purchase date (September 2014), your 12 month CD will mature. If you choose, we will automatically reinvest this CD into a 36-month CD. You may benefit from an APY that is likely to be higher than the current 12-month rate at that time and, as illustrated in the example above, this higher rate could immediately increase the blended rate on your total balance in all three CDs. Your remaining CDs have 12 months and 24 months remaining until maturity.

After the second year (September 2015), your 24-month CD will mature. We will automatically reinvest this CD into a 36-month CD also. Again you may benefit from an APY that is likely to be higher than the current 24-month rate and as shown, this higher rate could immediately increase the blended rate earned on your total balance in all three CDs. One of your CDs will mature every 12 months and all three CDs are now at higher rates associated with 36-month CDs.
Other CD Options:
Traditional Term CD
Relationship CD
Rising Rate CD
CD Ladder
Bump-Up CD
Three Month No Penalty CD
Flex CD


*Blended Rate: This is the weighted average interest rate of each of the individual certificates in your CD Ladder for the next liquidity period. Over time, as interest earnings are credited to your individual CDs or you increase or decrease the amount of an individual CD that is renewing, the blended rate you are earning will be updated to reflect these changes. The rates and terms shown are for purposes of example only and do not reflect actual rates and terms offered by Dollar Bank. The example assumes rates remain constant, however actual rates may vary substantially over time.
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