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<<The straight party line is the idea of maintaining a five year CD ladder to protect yourself from being forced to sell stocks at the bottom of a bear market.

I'm curious about the logistics of the 5-year CD ladder. Does this mean having 5 CD's that mature each in a different year? And do you keep your annual requirement in each CD so that the money is available each year? I'm not sure how this would work, and would like some explanation.

Yes, that's the plan. The idea is to give you some flexibility in selling off stocks or other assets to fund the CD or bond purchase in case you are in a down stock cycle. What you would like to avoid is having to selling stocks in a bear market ---this arrangement give you flexibility and a cash cushion to live on.

Seattle Pioneer
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