CD Laddering
CD ladders, step-up CDs, and bump-up CDs can help bank customers navigate a changing rate environment.
What are Step-Up CDs, Bump-Up CDs, and CD Ladders?
CDs with a step-up feature have an interest rate that changes on a predetermined schedule and automatically rises to a predetermined rate that is usually fixed for the remainder of the CD term.Bump-up CDs give depositors the right to request a rate increase during the term of the CD. Some CDs permit one adjustment; others allow two. The adjustment timing depends on the bank’s offering, and the availability of an adjustment typically depends on the bank’s decision to offer a higher rate.
CD ladders allow customers to invest in CDs with different dates of maturity and, as the individual CDs mature, reinvest the funds into new CDs with later maturity dates. By laddering, or staggering maturities, depositors can avoid reinvesting all of their money at one time, when interest rates may be low, and can take advantage of higher rates and new investment opportunities if they become available.
Protect Your Large Deposits with CDARS®
With CDARS, you can access millions of dollars of aggregate FDIC insurance across network banks on your CD investments through a single bank relationship. Ask your local bank about CDARS, and how you can structure the equivalent of bump-ups, step-ups, and laddered CDs as part of your investment strategy.
Learn more about CDARS and how it works
A list identifying IntraFi network banks can be found here. IntraFi is not an FDIC-insured bank, and deposit insurance covers the failure of an insured bank. Certain conditions must be satisfied for “pass-through” FDIC deposit insurance coverage to apply.
Find a Bank that Offers Services from IntraFi
Hear what others say about services from IntraFi
[My boss] has an ‘on top of it’ philosophy. CDARS gives us a single statement, and we know we’re protected and where the money has been transferred to. The service was made for someone like him.
Business Manager
Insurance Company
I have found participation in CDARS to be simple and a time saver. We earn very competitive interest rates on our investments while freeing up staff time. We were in CDARS during our last audit and passed with flying colors!
Christine J. Johnson
Treasurer, Dekalb County, IL
As with any CDARS placement, a placement resubmitted by using a Resubmission Agreement is not guaranteed, and unallocated funds will be returned to the depositor. If, at the time for resubmission specified in a Resubmission Agreement, the relationship institution is no longer authorized to submit orders using CDARS, then the resubmission will not occur. The depositor, prior to resubmission, can withdraw the depositor’s authorization to the relationship institution to resubmit the funds. If so, the Resubmission Agreement can provide that the relationship institution, in such circumstances, may impose an appropriate penalty, not unlike an early withdrawal penalty.
A list identifying IntraFi network banks appears at https://www.intrafi.com/network-banks. Certain conditions must be satisfied for “pass-through” FDIC deposit insurance coverage to apply. Deposit placement through an IntraFi service is subject to the terms, conditions, and disclosures in applicable agreements. Deposits that are placed through an IntraFi service at FDIC-insured banks in IntraFi’s network are eligible for FDIC deposit insurance coverage at the network banks. The depositor may exclude banks from eligibility to receive its funds. To meet the conditions for pass-through FDIC deposit insurance, deposit accounts at FDIC insured banks in IntraFi’s network that hold deposits placed using an IntraFi service are titled, and deposit account records are maintained, in accordance with FDIC regulations for pass-through coverage. Although deposits are placed in increments that do not exceed the FDIC standard maximum deposit insurance amount (“SMDIA”) at any one bank, a depositor’s balances at the institution that places deposits may exceed the SMDIA before settlement for deposits or after settlement for withdrawals or be uninsured (if the placing institution is not an insured bank). The depositor must make any necessary arrangements to protect such balances consistent with applicable law and must determine whether placement through an IntraFi service satisfies any restrictions on its deposits.
IntraFi, the IntraFi logo, and CDARS are registered service marks of IntraFi LLC.