How to build a bond ladder
A bond ladder splits money across bonds, Treasuries or CDs that mature one after another – for example every year for five years. As each one matures, you spend it or reinvest it at the long end.
Why people ladder
- Predictable income and return of principal on known dates.
- Less exposure to any single interest-rate moment.
- Each rung can be held to maturity.
Building the rungs
- Choose the span (for example 1 to 5 or 1 to 10 years).
- Pick one bond or Treasury per maturity, using after-tax yield for your state.
- Treasuries suit taxable accounts in high-tax states; munis suit high federal brackets.
Find bonds for each rung
IncomeGrid has 40,000+ investment options screened with filters by term and risk level 1–5. IncomeGrid ranks every item by yield after tax for where you live: federal, state and each investment type (Treasuries, municipal bonds, corporate bonds, funds, REITs and filed offerings are each taxed differently).
Sources
- U.S. Treasury – Daily Treasury par yield curve rates
- TreasuryDirect – Treasury bills
- Investor.gov – Bonds
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