A client called before leaving for vacation. His IRA held a short-term Treasury bond fund, and he had just wired in a sizable amount of cash. “What’s best to do with the new money?” he asked.
We talked through the alternatives and he clearly stated that he wanted this portion to be conservative. The Treasury fund was low-volatility and liquid, but the yield had been edging lower. CDs (Certificates of Deposit from a bank) were paying more, and he liked the idea of locking in a rate he could count on.
What struck me was how many people hold bond funds without fully understanding how they work. Bond funds can lose value when interest rates move, even if the underlying bonds are high quality. A CD held to maturity guarantees your principal and interest through FDIC insurance. For someone who wants predictability, that difference matters.
Building a CD ladder for stability
We split the money into three CDs with staggered maturities at six, twelve, and eighteen months. This created a simple ladder that would free up cash at regular intervals without locking everything away at once.
Laddering also solves a common problem I see with retirees managing U.S. accounts from Israel. If all your CDs mature at the same time, you face a reinvestment decision at a single point in the interest rate cycle. By spreading out maturities, you reduce that timing risk and create more flexibility.
Small adjustments can make a real difference
Opting for CDs instead of bond funds was not a dramatic change, but it illustrated a broader point. Many Americans living in Israel treat their U.S. retirement accounts as a static pool of funds. Small adjustments to structure, yield, and maturity timing can improve outcomes without adding unnecessary risk. The key is knowing when to act and how to coordinate these changes with your broader financial plan.
If you want to review your cash allocation, bond holdings, or CD strategy, schedule a free introductory call at profile-financial.com/call or contact our office at 02-624-2788.
Douglas Goldstein, CFP® is the director of Profile Investment Services, Ltd. profile-financial.com. He is a licensed financial professional in both the U.S. and Israel. Call (02) 624-2788 for help with your U.S. brokerage and IRA accounts. Securities offered through Portfolio Resources Group, Inc. Member FINRA, SIPC, MSRB, FSI. The author’s opinions are not necessarily those of PRG or its affiliates. Neither PRG nor its affiliates provide tax or legal advice.
Published September 8, 2026.