Updated August 13, 2026. Quick answer: a CD ladder calculator that ignores deposit insurance will happily tell you to put a million dollars in one bank. This one sizes each rung by what it will be worth at maturity, not by what you put in — because FDIC coverage counts principal plus accrued interest, and interest is exactly what a ladder is designed to accumulate. A $1,000,000 five-year ladder at 4.5% would peak at $1,045,000 at a single institution, leaving $795,000 uninsured. Split correctly it needs 5 institutions and nothing is ever uninsured.
The ladder builder
The rule the other calculators ignore
“Deposit insurance is calculated dollar-for-dollar, principal plus any interest accrued or due to the depositor, through the date of default. For example, if a customer had a CD account in her name alone with a principal balance of $195,000 and $3,000 in accrued interest, the full $198,000 would be i…” — www.fdic.gov
Read that against what a ladder does. Every rung is accruing at once, and the ones that have not matured yet are still sitting at the bank. The exposure that matters is not the deposit — it is the largest total the institution holds at any moment, with interest on top. That is the number this tool packs against the limit, and it is why the $1,000,000 example needs 5 banks rather than four.
A $1,000,000 ladder, worked
Five rungs, 4.5%, $250,000 of capacity per institution:
| Rung | Term | Deposit | Worth at maturity | Where |
|---|---|---|---|---|
| 1 | 1 year | $200,000 | $209,000 | Bank 5 |
| 2 | 2 years | $200,000 | $218,405 | Bank 4 |
| 3 | 3 years | $200,000 | $228,233 | Bank 3 |
| 4 | 4 years | $200,000 | $238,504 | Bank 2 |
| 5 | 5 years | $200,000 | $249,236 | Bank 1 |
The peak matters more than any single rung: held together at one bank these five rungs are worth $1,045,000 at the end of the first year, because all five are still there and all five have earned a year of interest. That is $795,000 over the limit on day 365, long before any rung matures.
If a bank fails in the middle of it
A ladder is a multi-year commitment, so this is not hypothetical. Two rules decide what happens. Your CD contract does not survive:
“It is important for account owners to note that their deposit contract was with the failed bank and is considered void upon the failure of the bank. The acquiring institution has no obligation to maintain either the failed bank rates or terms of the account agreement. Depositors of a failed bank, however, do have the option of e…” — www.fdic.gov
So the rung you locked at a good rate can be repriced by whoever takes it over — and you may leave without the early-withdrawal penalty, which is the compensation. After a merger rather than a failure, assumed CDs stay separately insured for six months, then to the next maturity. Our page on what happens when a bank fails walks the whole sequence.
Brokered CDs change the plumbing, not the limit
Buying the ladder through one brokerage account is administratively easier and the insurance still reaches you, on a pass-through basis with conditions:
““Pass-through” deposit insurance is a method of insuring depositors whose funds are placed and held at an FDIC-insured bank through a third party. Third parties in pass-through arrangements may include, but are not limited to: … Brokers who offer brokered CDs … If the following requirements are…” — www.fdic.gov
The conditions are about titling and records, which is precisely what our page on brokerage cash calls the recordkeeping condition nobody mentions, and brokered vs bank CDs compares the two products. The cap-aware arithmetic above does not change: two brokered CDs from the same issuing bank share one limit, however many statements they arrive on.
Where the cash sits is a decision of its own
Comparing one place to hold money against another answers part of the question; how much belongs in cash at all, and what the rest should be doing, is the other part, and an adviser can work through both with you.
Before you start, what actually happens. The form is run by Kapitalwise, our advisor-matching partner. Kapitalwise sends your details to advisers who pay for the introduction, so expect calls and texts. Clear Money Guide is paid when you submit the form, whether or not you ever hire anyone. This is free to you and there is no obligation to hire anyone.
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It asks about nine questions (age, investable assets, location), then your name, email and phone number, and verifies the phone by text. Nothing loads and nothing reaches Kapitalwise until you press the button. Submitting the form does not guarantee an adviser or a match. This matching form is not tax or legal advice. Submitting the form does not guarantee an adviser or a match. This matching form is not tax or legal advice.
What we could not establish, and are not going to invent
Three things the model does not do:
- Rates. This tool takes an APY as an input and does not know what anyone is paying. It is not a rate table and there is no product recommendation anywhere on this page.
- Reinvestment. The ladder is modelled to maturity, with proceeds leaving the institution as each rung matures. If you roll every rung back into the same bank, the exposure is higher than shown and the bank count goes up.
- Credit unions. Share certificates run on NCUA’s rulebook, which does not converge with the FDIC’s trust rules until 1 December 2026. Use the capacity field deliberately if your money is there.
Sources
The insurance rules this tool enforces are read from the FDIC’s own material and from 12 CFR part 330 on August 13, 2026.
| What it establishes | Read at |
|---|---|
| FDIC insurance covers accrued interest along with principal, up to the date of the bank’s default/closing — accrued interest counts toward the $250,000 limit, it is not insured separately or on top of it. | www.fdic.gov |
| When a bank fails and is acquired, the acquiring bank is NOT obligated to honor the failed bank’s CD rates or terms; depositors may instead withdraw funds without penalty. | www.fdic.gov |
| CD insurance coverage after a bank merger/assumption continues separately for a 6-month grace period (or until the CD’s next maturity date after that period if renewed on the same terms). | www.fdic.gov |
| Brokered CDs are insured to the same $250,000-per-owner-per-category limit as directly held deposits, on a ‘pass-through’ basis, conditioned on specific recordkeeping/titling requirements being met. | www.fdic.gov |
| FDIC’s own consumer-facing phrasing of the SMDIA rule uses the exact words ‘per depositor, per insured bank, for each account ownership category’. | www.fdic.gov |
| The SMDIA (Standard Maximum Deposit Insurance Amount) is $250,000, defined by regulation. | www.ecfr.gov |
| Deposits at different branches/offices of the SAME insured bank are NOT separately insured — they are added together. | www.ecfr.gov |
| Two banks that are separately chartered and separately insured are insured SEPARATELY from each other, even if commonly owned by the same holding company. | www.ecfr.gov |
Cite or share this calculator
Suggested citation: Clear Money Guide, “FDIC-Aware CD Ladder Calculator (2026),” clearmoneyguide.com/cd-ladder-calculator/. Free to cite with attribution.
Methodology: each rung’s value at time t is its deposit compounded at the APY entered, and an institution’s exposure at t is the sum of the rungs it still holds at t. Rungs are packed into institutions largest-first so that no institution’s peak exposure exceeds the insured capacity entered, coverage being measured on principal plus accrued interest under the FDIC’s own rule. No login, no email capture, and no rates are quoted or recommended.
General information about deposit-insurance arithmetic, not financial advice. APY is your input, not a quote; the tool does not know or recommend any bank’s rates. Insured capacity assumes separately chartered, FDIC-insured institutions.