By YOUNG MONEY Staff
3 September 2010

Laddering certificates of deposit - or bonds - is an effective and often little-discussed strategy to preserve and grow your wealth through uncertain economic periods. It shouldn't be confused with laddering stock purchases, an illegal form of insider trading.

One of the most important overlooked bank services is the CD - which works basically like a bank-issued, Federal Deposit Insurance Corporation-insured bond. CDs have a maturity - from as short as three months to as long as five years - and an annual percentage rate, which will usually be around 1 and 3 percent.

With laddering, you purchase CDs of varying maturities - one at 6 months, one at 12 months and one at 24 months, for instance.

Longer-term CDs generally have higher rates, but they lock your money up more completely than most other investments. With laddering, you can spread your money out across a variety of products, and when the shorter-term CDs mature, you can withdraw the money you need and renew the rest of the funds at a higher, long-term rate.

Spread over a number of years, you end up with a "ladder" of relatively high-yield CDs maturing every year, giving you access to your funds as well as decent - and extraordinarily safe - ROI.