How does laddering CDs work for near-term cash needs?

A CD ladder splits your cash across several certificates with staggered maturity dates so you regularly get access to a portion while still earning fixed CD rates on the rest. For example, instead of one 12-month CD, you might open CDs maturing in 3, 6, 9, and 12 months. As each one matures you either use the cash or roll it into a new longer CD, keeping the ladder going. The benefits: you avoid locking everything up at once, you reduce the risk of committing all your money right before rates rise, and you keep a steady stream of liquidity. Laddering suits money you'll need over the next year or two — not your instant-access emergency cushion, which should stay in savings. Because CDs are FDIC-insured up to the limit, a ladder is a safe way to earn a bit more on near-term cash.