Have you ever considered investing some money into one of those CD’s at the banks? I know that these CD’s very often have terms that include a minimum amount of time you have to wait until you can access your money.

Most people considering an investment like this have a certain amount of money set aside that they are willing to invest in something as low risk as a CD. These people often believe that they will not be in dire need of this money for awhile.

But, what if?

Lot’s of people resist investing in CD’s because of that “what if.”

Everyone knows that it is possible that an emergency may occur and they could be in need of that cash NOW!

How about this?

Let’s say that you have $10,000 that you have decided you want to invest in a low risk CD.

Let’s say that this particular CD has an interest rate of 5%, and a term of 2 years.

Instead of investing all of the $10,000 into one CD, why not break up that money and instead stagger your investments into smaller, strategically timed CDs.

What do I mean:

Why not break the $10,000 into 5 CD investments of $2,000 in each one of them.

How would this affect the interest you earn?

It wouldn’t, here is the math:

$10,000 times.05 = $500

So, you can expect to $500 from your CD investment.

What about breaking that $10,000 into 5 CDs of $2,000 invested in each one:

CD #1: $2,000 times.05 = $100

CD #2: $2,000 times.05 = $100

CD #3: $2,000 times.05 = $100

CD #4: $2,000 times.05 = $100

CD #5: $2,000 times.05 = $100

$100 + $100 + $100 + $100 + $100 = $500

So, from these 5 CDs with $2,000 invested in each would earn you a total of $500.

Clearly, you can see that investing in both ways gives you the same amount of money ($500), correct?

Now, how would one strategically time these to plan a little more for that “what if.”

Think about this, why not invest CD # 1 today, CD #2 next year, CD #3 the following year, CD #4 the year after that, and finally CD #5 that following year.

How does this help with the “what if?”

Well, essentially if you invest CD #1 this year for a term of 5 years, $2,100 (the initial $2,000 invested plus the $100 in interest) will be available to you, without penalty 5 years from now.

If you need that money then, use it, if not, you are free to re-invest.

Then CD #2 funds will become available to you in 6 years, CD #3 in 7 years, etc.

Basically, every year you will have $2,100 ($2000 + $100 in interest) available to you if you need it!

Wow, now that sounds nice to me, investing and having that money available to you! Who would have thought?