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9. Financial Planning > Build a Ladder of Fixed-Income Investments

Build a Ladder of Fixed-Income Investments

Building a CD ladder provides access to your money while limiting your exposure to interest rate and inflation changes.

Do you invest in longer-term certificates of deposit to get the highest interest rate, or do you put your money in shorter-term CDs so it is more accessible even if it means settling for a lower interest rate? A strategy called laddering lets you have your cake and eat it too. Laddering a CD is similar to dollar-cost averaging when buying stocks or mutual funds. Managing your cash investments should be part of your overall investment portfolio strategy. The right cash management strategy can provide access to your cash when you need it while achieving higher overall returns.


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