This Is How Much Money You Can Make With $10,000 in a CD Ladder
KEY POINTS
- At today's interest rates, a $10,000 CD ladder can be reasonably expected to produce $400 to $450 in annual income.
- The exact amount of income depends on the banks you use and the interest rates available at the time.
- It's difficult to project CD ladder income beyond the first year, mainly due to changes in interest rates.
A CD ladder can be an excellent way to combine financial flexibility with risk-free, steady income. A CD ladder consists of dividing your money into several CDs of staggered maturity terms. The idea is that every year, some of your money will mature and can be either used or reinvested, while the bulk of your money takes advantage of stable interest income.
With CD interest rates still at their highest levels since before the 2008 financial crisis, it's possible to set up a CD ladder that produces a relatively high income stream. Here's a look at how much you can make with $10,000 in a CD ladder, and a couple of things to keep in mind before you start opening accounts.
An example of a $10,000 CD ladder
The exact amount of money you can make from a CD ladder depends on the CDs you choose, as well as the prevailing interest rates at the time.
Depending on when you're reading this, CD rates could be significantly higher or lower than they are as of this writing (Aug. 9).
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| Product | APY | Min. to Earn | |
American Express® High Yield Savings
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APY
3.70%
Rate info
3.70% annual percentage yield as of March 6, 2025. Terms apply.
Min. to earn
$0
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3.70%
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3.70% annual percentage yield as of March 6, 2025. Terms apply.
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SoFi Checking and Savings
Member FDIC.
APY
up to 3.80%²
Rate info
You can earn the maximum APY by having Direct Deposit (no minimum amount required) or by making $5,000 or more in Qualifying Deposits every 30 days. See SoFi Checking and Savings rate sheet at: https://www.sofi.com/legal/banking-rate-sheet.
Min. to earn
$0
Open Account for SoFi Checking and Savings
On SoFi's Secure Website. |
up to 3.80%²
Rate info
You can earn the maximum APY by having Direct Deposit (no minimum amount required) or by making $5,000 or more in Qualifying Deposits every 30 days. See SoFi Checking and Savings rate sheet at: https://www.sofi.com/legal/banking-rate-sheet.
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$0
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Open Account for SoFi Checking and Savings
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Capital One 360 Performance Savings
Member FDIC.
APY
3.70%
Rate info
See Capital One website for most up-to-date rates. Advertised Annual Percentage Yield (APY) is variable and accurate as of Feb. 6, 2025. Rates are subject to change at any time before or after account opening.
Min. to earn
$0
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On Capital One's Secure Website. |
3.70%
Rate info
See Capital One website for most up-to-date rates. Advertised Annual Percentage Yield (APY) is variable and accurate as of Feb. 6, 2025. Rates are subject to change at any time before or after account opening.
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$0
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Open Account for Capital One 360 Performance Savings
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SoFi disclosure:
¹ New and existing Checking and Savings members who have not previously enrolled in Direct Deposit with SoFi are eligible to earn a cash bonus of either $50 (with at least $1,000 total Direct Deposits received during the Direct Deposit Bonus Period) OR $300 (with at least $5,000 total Direct Deposits received during the Direct Deposit Bonus Period). Cash bonus will be based on the total amount of Direct Deposit. Direct Deposit Promotion begins on 12/7/2023 and will be available through 1/31/26. See full bonus and annual percentage yield (APY) terms at sofi.com/banking#1.
² SoFi members who enroll in SoFi Plus with Direct Deposit or by paying the SoFi Plus Subscription Fee every 30 days or with $5,000 or more in Qualifying Deposits during the 30-Day Evaluation Period can earn 3.80% annual percentage yield (APY) on savings balances (including Vaults) and 0.50% APY on checking balances. There is no minimum Direct Deposit amount required to qualify for the stated interest rate. Members without either SoFi Plus or Qualifying Deposits, during the 30-Day Evaluation Period will earn 1.00% APY on savings balances (including Vaults) and 0.50% APY on checking balances. Only SoFi Plus members are eligible for other SoFi Plus benefits. Interest rates are variable and subject to change at any time. These rates are current as of 1/24/25. There is no minimum balance requirement. Additional information can be found at http://www.sofi.com/legal/banking-rate-sheet. See the SoFi Plus Terms and Conditions at https://www.sofi.com/terms-of-use/#plus.
³ We do not charge any account, service or maintenance fees for SoFi Checking and Savings. We do charge a transaction fee to process each outgoing wire transfer. SoFi does not charge a fee for incoming wire transfers, however the sending bank may charge a fee. Our fee policy is subject to change at any time. See the SoFi Checking & Savings Fee Sheet for details at sofi.com/legal/banking-fees/.
⁴ SoFi Bank is a member FDIC and does not provide more than $250,000 of FDIC insurance per legal category of account ownership, as described in the FDIC’s regulations. Any additional
FDIC insurance is provided by the SoFi Insured Deposit Program. Deposits may be insured up to $2M through participation in the program. See full terms at SoFi.com/banking/fdic/terms
See list of participating banks at SoFi.com/banking/fdic/receivingbanks
⁵ We’ve partnered with Allpoint to provide you with ATM access at any of the 55,000+ ATMs within the Allpoint network. You will not be charged a fee when using an in-network ATM, however, third-party fees incurred when using out-of-network ATMs are not subject to reimbursement. SoFi’s ATM policies are subject to change at our discretion at any time.
⁶ Early access to direct deposit funds is based on the timing in which we receive notice of impending payment from the Federal Reserve, which is typically up to two days before the scheduled payment date, but may vary.
⁷ Overdraft Coverage is limited to $50 on debit card purchases only and is an account benefit available to customers with direct deposits of $1,000 or more during the current 30-day Evaluation Period as determined by SoFi Bank, N.A. The 30-Day Evaluation Period refers to the “Start Date” and “End Date” set forth on the APY Details page of your account, which comprises a period of 30 calendar days (the“30-Day Evaluation Period”). You can access the APY Details page at any time by logging into your SoFi account on the SoFi mobile app or SoFi website and selecting either (i) Banking > Savings > Current APY or (ii) Banking > Checking > Current APY. Members with a prior history of non-repayment of negative balances are ineligible for Overdraft Coverage.
Having said that, here's an example of a CD ladder using some of the best readily available CD rates from our top online banks, and what it could mean for your income:
| CD term | Amount deposited | APY | Year 1 income |
|---|---|---|---|
| 1 year | $2,000 | 5.00% | $100 |
| 2 years | $2,000 | 4.60% | $92 |
| 3 years | $2,000 | 4.25% | $85 |
| 4 years | $2,000 | 4.15% | $83 |
| 5 years | $2,000 | 4.00% | $80 |
| Total | $10,000 | $440 |
In this example, our CD ladder would produce a total of $440 in interest income over the course of one year.
A couple of things to keep in mind
First and foremost, if you're starting a CD ladder with any amount except exactly $10,000, simply multiply or divide the figures in the chart accordingly. As an example, if you want to create a $50,000 CD ladder, multiply the income by five to get a good idea of what you could make.
Second, keep in mind that this is just the CD ladder's first-year income, and it can get difficult to accurately project what you could make beyond one year. There are two main reasons for this:
- Your 1-year CD will mature, and you'll roll it into a new 5-year CD. There's no way to know what the prevailing 5-year CD rates will be at that point.
- With all your other CDs, you can either collect the interest income they earn to cover your expenses, or you can leave it in the account to compound. There's no right or wrong way to do it, but the option you choose will have an impact on your income in year two and beyond.
The bottom line
A CD ladder can be an excellent way to take advantage of the income visibility of long-term CDs, while still maintaining financial flexibility and a high level of current income.
Your income from a CD ladder depends on how much money you have, the bank(s) at which you open CDs, and the interest rate environment both now and in the future. But it can be a great way to set up a recurring income stream without locking all of your money up for several years.
Our Research Expert
Matt Frankel, CFP, has been a contributing writer, analyst, and personal finance expert for The Motley Fool since 2012.
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