CD Calculator
Calculate your certificate of deposit maturity value, interest earned, and APY — with a comparison table of different terms and rates.
How to Use the Calculator
- 1Enter your deposit amount annual rate and term. Choose compounding frequency — most CDs compound daily or monthly. The comparison table shows returns across all common CD terms.
Example Calculation
Principal $10,000 | Rate 4.5% | 12 months | Monthly compounding
- Maturity Value: $10,459.40
- Interest: $459.40
- APY: 4.59%
Frequently Asked Questions
What is a CD?
A certificate of deposit is a savings product offered by banks and credit unions that pays a fixed interest rate for a set period. In exchange for locking up your money for the term you receive a higher rate than a regular savings account. CDs are FDIC insured up to $250,000 per depositor per institution making them one of the safest investments available.
What is APY and how does it differ from the interest rate?
APY stands for Annual Percentage Yield and represents the effective annual return after accounting for compounding. A CD with a 4.5% annual rate compounded monthly has an APY of 4.59% because interest compounds each month and earns interest on itself. APY allows for apples-to-apples comparison between CDs with different compounding frequencies.
What happens if I withdraw early from a CD?
Most CDs charge an early withdrawal penalty if you take money out before maturity. The penalty is typically 3 months of interest for terms under 12 months and 6 months of interest for longer terms. Some no-penalty CDs allow early withdrawal but usually offer lower rates. Always check the specific penalty terms before opening a CD.
Should I choose a longer or shorter CD term?
Longer CD terms typically offer higher rates but lock up your money for longer. In a rising rate environment shorter terms are better so you can reinvest at higher rates when the CD matures. In a falling rate environment longer terms lock in higher rates before they drop. Consider a CD ladder strategy — splitting deposits across multiple terms — to balance higher rates with liquidity.
Are CD rates negotiable?
Standard CD rates at major banks are generally fixed. However jumbo CDs (typically $100,000 or more) may offer better rates and some community banks and credit unions will negotiate rates for large deposits. Online banks consistently offer higher CD rates than traditional brick-and-mortar banks. Always compare rates from multiple institutions before opening a CD.