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# Meet the Automated Bond Ladder

### 3.58% - 3.59%

Range of current yields on Treasuries in our 3-month ladder, after our 0.15% advisory fee.

No advisory fee for 3 months on your first Automated Bond Ladder! [Terms apply.](https://support.wealthfront.com/hc/en-us/articles/23265024478484-Automated-Bond-Ladders#fee_waiver_terms)

# Earn more on your extra cash with zero state taxes.

A ladder of US Treasuries can help you earn more — and keep more — than [most savings accounts and some CDs](/content/automated-bond-ladder#/index.html). Since Treasuries are exempt from state and local income taxes, you can take home more interest on money you may be saving for future expenses. Just choose how long you want to invest, when you want your funds back — and we’ll handle the rest.

1.4M+

Funded clients

$95B+

In total assets

4.8

Apple AppStore 1

4.9

Google PlayStore 1

## Curious what $0 in state income taxes could mean for you?

## You’d have to earn...

0.00%

to match

0.00%

in Treasury interest

Choose ladder duration

3 months

State of residence

Select state

Annual income

$150,000

Filing status

Select status

show me

Wait, what’s “fully taxed interest?”

By “fully taxed interest” we mean interest that’s taxable at both the state and federal levels. Interest from savings accounts, CDs, and corporate bonds are taxed as ordinary income — all federal and state taxes apply. Treasuries, on the other hand, are exempt from state income taxes.

See disclosures and assumptions

This interactive analysis tool presents hypothetical outcomes intended for informational purposes only. Average yield estimates assume each ladder rung holds equal weights and all Treasuries are held to maturity. Tax equivalent yield is calculated using federal and state marginal income tax rates based on user inputs. Both figures are net of a 0.15% annual advisory fee. Nothing in this communication should be construed as tax advice, a solicitation or offer, or recommendation, to buy or sell any security. All investing involves risk, including the possible loss of money you invest, and past performance does not guarantee future performance. Please see our [Full Disclosure](/content/legal/disclosure/index.html) for important details.

## Meet the Automated Bond Ladder.

A bond ladder — a portfolio of bonds that mature at different times — locks in current yields while keeping your funds flexible. Whether you’re saving for an important expense or waiting to invest in the stock market, the Automated Bond Ladder offers a steady yield on your extra cash — without limiting access to your funds.

### Locked-in rates

The Automated Bond Ladder is designed to weather changing interest rates by spreading your investment across US Treasuries with different maturities. Locking in rates can mean securing current yields for months or years to come depending on your goals.

### Very low risk

US Treasuries are backed by the full faith and credit of the US Government, which means there’s very little risk of default.

### Easy access to funds

Access your funds with no penalties and no hassles. Choose to automatically withdraw monthly interest and principal, set a target withdrawal date, or keep reinvesting into new Treasuries.

## Keep your savings up. Even if interest rates drop.

Although the federal funds rate is expected to decline regularly over the next two years, you can still lock in current rates by investing in a ladder of Treasuries today. By holding multiple Treasuries of different maturities, you’ll earn a steady yield for your chosen duration.

## To build your own bond ladder, you’ll need patience and plenty of research. Or just use our app.

Choose how long you want to invest (from three months to six years) and we’ll show you your estimated average yield. We’ll compare hundreds of Treasuries to prioritize high coupon payments and liquidity, and keep your ladder balanced as your rungs mature.

## All investing involves risk. With Treasuries, that’s not very risky.

### Savings account

For your daily expenses and your emergency fund.

### US Treasuries

Backed by the full faith and credit of the US government, Treasuries offer a steady rate and are considered among the safest investments in the world.

### Index funds

The time-tested approach designed to earn you greater returns over the long term, with more exposure to risk.

### Individual stocks

Owning single stocks provides an opportunity to invest in companies you believe in, but can expose you to market volatility and company-specific risks.

## Where should you save your extra cash? See your options.

Automated Bond Ladder

Savings account

Certificate of Deposit

Portfolio of corporate bonds

| Yield                              | Risk of losing principal                                                                 | Insurance                                     | Taxes                                                                | Liquidity                                                                | Fees                                                                |
|-----------------------------------|------------------------------------------------------------------------------------------|----------------------------------------------|----------------------------------------------------------------------|------------------------------------------------------------------------|--------------------------------------------------------------------|
| 3.58% – 3.59%                     | Very low if held to maturity: Treasuries are backed by the full faith and credit of the US government | SIPC insured up to $500K                     | Exempt from state and local income taxes; federal income taxes apply | No fees for early withdrawals; selling before maturity can result in reduced yield       | Annual 0.15% advisory fee                                            |
| 0.39% APY                          | Very low: Subject to FDIC insurance limits                                               | FDIC insured up to $250K                      | Federal, state, and (potentially) local income taxes apply          | Fully liquid                                                            | Service and maintenance fees may apply                              |
| Variable depending on duration    | Very low: Subject to FDIC insurance limits                                               | Typically FDIC insured up to $250K             | Federal, state, and (potentially) local income taxes apply          | Fees or penalties may apply for early withdrawals                     | No fees                                                            |
| Variable depending on duration and issuer | Medium: Variable based on issuers credit rating                                       | Typically SIPC insured when held in a brokerage account | Federal, state, and (potentially) local income taxes apply          | No fees for early withdrawals; selling before maturity can result in reduced yield | Management fees and other fees may apply                             |

## Ready to start earning? Ladder up.