Split a fixed-income allocation across staggered maturities so each year (or six months, or two years) one rung matures and reinvests at the prevailing yield. Smooths reinvestment risk, gives predictable liquidity, and lets the curve do useful work.
| Rung | Maturity | Allocation | Yield | Value at maturity |
|---|---|---|---|---|
| #1 | 1.0 yrs | ₹2.00 L | 7.00% | ₹2.14 L |
| #2 | 2.0 yrs | ₹2.00 L | 7.15% | ₹2.30 L |
| #3 | 3.0 yrs | ₹2.00 L | 7.30% | ₹2.47 L |
| #4 | 4.0 yrs | ₹2.00 L | 7.45% | ₹2.67 L |
| #5 | 5.0 yrs | ₹2.00 L | 7.60% | ₹2.88 L |
The opposite of putting ₹10 lakh into a single 5-year bond at 7% and crossing your fingers that 5-year yields are still 7% on the maturity date. With a 5-rung 1Y-step ladder you reinvest ₹2 lakh every year at the new prevailing 5-year yield — locking in some of any rate cycle that arrives.
The yield numbers here are point assumptions you enter, not a live yield curve. For the actual current curve, the closest free public sources are RBI's G-Sec auction results and the Clearcorp Repo Order Matching System (CROMS) yields, both available daily.
The value-at-maturity column compounds each rung's yield over its individual tenure — it's a coupon-reinvestment shortcut that overstates the actual return slightly for very long-dated rungs (because coupons would otherwise be reinvested at lower yields). Full methodology · reviewed January 2026.
Educational projection only. Bond yields shown are user-input estimates, not live quotes. MintByte is an AMFI-registered mutual fund distributor (ARN-314872); SEBI Registered Investment Adviser and Research Analyst registrations are in process. Not investment advice.