It’s time for another guest post! Jim from Bargaineering.com is here to give us some quick advice on boosting our savings. Jim writes about personal finance and other money issues at his personal finance blog Bargaineering.com, and you can find him on Twitter @bargainr. 
One of the easiest and safest ways to boost your savings is by building a certificate of deposit "ladder," otherwise known as a CD ladder. Building a CD ladder simply means that you deposit funds into CDs with different maturity dates so that one CD matures each month. As it matures, you deposit those funds into another CD. Then the cycle keeps repeating itself.
Most people do this with their emergency funds. If you have an emergency fund with six months of expenses, you theoretically would only need one month's worth of savings at any one time. If you lose your job, you'd only need one month's of expenses each month, and each month a CD would mature, giving you penalty-free access to your money. During times when you didn't need to use that money, you benefit from the fact that CD rates trump any rate you could find in a savings account.
How do you set this up? It's quite simple. First, figure out how many months will be in your ladder. In our example, we will assume you're building a 12-month ladder with $500 saved in each "rung." Since most banks offer 3, 6, 9, and 12-month CDs, we will start from there.
- In the first month, deposit $500 each into a 3, 6, 9, and 12-month CD. Wait one month.
- In the second month, deposit $500 each into 3, 6, 9, and a 12-month CD. At this point you'll have a 2, 3, 5, 6, 8, 9, 11, and 12 month CD (since the 3/6/9/12 CD of month one will have matured a month, making it effectively 2/5/8/11 CDs).
- In the third month, deposit $500 each into a 3, 6, 9, and a 12-month CD. At this point you have 12 CDs maturing in 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, and 12 months. Your ladder is complete.
As you'll notice, with 12 months you need 13 months of savings if you want to keep one month's of expenses on hand. In the above example, all of your savings are locked up into CDs and you would need to wait a month before the first CD matures.
Pretty straightforward, right? It's 100% safe because CDs are covered by FDIC insurance and cannot go down in value. The risk is that you will need the money. CDs will charge you a 3-6 month interest penalty if you withdraw your funds early. However, if you plan things correctly and use a CD ladder, you will get access to your funds each month so, hopefully, you won't need to withdraw it early.
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