CD Calculator
See what a certificate of deposit will be worth at maturity. Enter your deposit, the APY, and the term to get the ending balance and total interest earned.
Assumes interest stays in the CD until maturity and no early withdrawal. APY already includes compounding; if your bank quotes a nominal rate instead, use the rate option (compounded monthly). CD interest is taxable as ordinary income in the year it is credited. Estimate only — confirm terms with your bank.
How to use this calculator
Three inputs give you the full picture of a CD offer:
- Deposit amount — CDs are single, up-front deposits; you generally cannot add money mid-term
- Interest rate — use APY if that is what the bank advertises (it almost always is); switch to the rate option only if you have a nominal rate compounded monthly
- Term — in months or years; common terms run from 3 months to 5 years
The result shows the value at maturity, the interest earned, and the total percentage growth, with year-by-year balances for multi-year terms. To compare a CD against an account with ongoing deposits, use the compound interest calculator or savings calculator.
How a CD works
A certificate of deposit trades flexibility for a guaranteed rate: you agree to leave a fixed deposit with the bank for a set term, and the bank locks in an interest rate for that entire term. Unlike a savings account — where the rate can fall the week after you open it — a CD's rate is contractual. Combined with FDIC insurance up to $250,000, that makes the outcome fully predictable: the maturity value this calculator shows is, barring early withdrawal, exactly what you will receive.
The trade-off is access. Withdraw before maturity and the bank charges a penalty, typically forfeiting several months of interest. That is why the term you choose should match when you actually need the money — a wedding next spring, tuition in two years — rather than simply chasing the highest rate on the longest term.
Worked example — step by step
Suppose you deposit $10,000 in an 18-month CD at 4.5% APY:
- Years: 18 ÷ 12 = 1.5
- Growth factor: (1 + 0.045)1.5 = 1.0682
- Maturity value: $10,000 × 1.0682 = $10,682
- Interest earned: $682 (6.82% total growth)
Compare that to leaving the same $10,000 in a savings account that starts at 4.5% but drops to 3.5% after six months: you would earn roughly $605 — and the drop was entirely outside your control. The CD's locked rate is worth the most when rates are falling; when rates are rising, shorter terms or a ladder keep you flexible.
How to interpret your result
The interest figure is pre-tax: CD interest is ordinary income, so at a 22% federal rate the $682 above nets about $532 after federal tax. It is also worth checking the result against inflation — a CD that pays 4.5% while prices rise 3% earns about 1.5% in real purchasing power. CDs shine for money with a known date and a need for certainty; for long horizons, growth assets have historically outpaced them.
Before you commit, check three things on the disclosure: the early-withdrawal penalty (months of interest), the grace period at maturity, and the auto-renewal terms — banks renew at the current rate, not your original one, so a maturity-date reminder protects your yield. If you are deciding between locking money up and paying down debt instead, the debt payoff calculator shows the guaranteed "return" of eliminating interest charges.
Common mistakes to avoid
- Comparing rate to APY. One bank's 4.41% rate and another's 4.50% APY may be the same offer. Always compare APY to APY.
- Letting a CD auto-renew unattended. A 5% CD that quietly renews into a 2% CD costs you more than any fee. Calendar the maturity date and shop rates during the grace period.
- Ignoring the penalty math on long terms. A 5-year CD at a slightly higher APY can underperform an 18-month CD if there is a real chance you will need the money early.
- Exceeding FDIC limits at one bank. Amounts above $250,000 per depositor per bank are uninsured. Split large balances across institutions.
- Forgetting taxes accrue annually. On multi-year CDs you owe tax on interest credited each year, even though you cannot spend it until maturity — plan for the 1099-INT.
This tool is an estimate for standard fixed-rate CDs and is not financial advice. Rates, compounding schedules, penalties, and renewal terms vary by institution — confirm the disclosure before opening an account.
How we calculate this
In APY mode we apply the annual percentage yield directly: maturity value = deposit × (1 + APY)years, since APY by definition already includes compounding (partial years use fractional exponents, matching how banks credit a 6- or 18-month term). In rate mode we compound the stated nominal rate monthly. We assume interest remains in the CD until maturity and no early withdrawal. Taxes and early-withdrawal penalties are not modeled. Rates are set by your bank; this tool computes the arithmetic, not an offer.
Sources
Frequently asked questions
How is CD interest calculated?
Banks quote CDs by APY (annual percentage yield), which already includes the effect of compounding. Your maturity value is the deposit multiplied by (1 + APY) raised to the number of years. A $10,000 CD at 4.5% APY for 12 months earns $450, for a maturity value of $10,450. Enter your deposit, rate, and term above to see your exact numbers.
What is the difference between APY and the interest rate on a CD?
The interest rate (nominal rate) is the stated annual rate before compounding; APY is the rate you actually earn in a year after compounding is included. A 4.41% rate compounded monthly works out to about 4.50% APY. When comparing CDs, always compare APYs — that is the true annual return, and banks are required to disclose it.
Is CD interest taxable?
Yes. Interest on a CD held in a regular account is taxed as ordinary income in the year it is credited to you, even if you leave it in the CD until maturity. Banks report it on Form 1099-INT. CDs held inside an IRA are the exception — taxes follow the IRA rules instead.
What happens if I withdraw from a CD early?
Most CDs charge an early-withdrawal penalty, commonly several months of interest — for example 3 months of interest on shorter terms or 6 to 12 months on longer ones. If you withdraw before earning that much interest, the penalty can eat into your principal. No-penalty CDs exist but usually pay a lower APY.
Are CDs FDIC insured?
CDs at FDIC-member banks are insured up to $250,000 per depositor, per bank, per ownership category — the same coverage as checking and savings accounts. Credit union CDs (share certificates) carry the same coverage through the NCUA. Above those limits, spreading deposits across banks preserves full coverage.
What is a CD ladder?
A ladder splits your money across CDs with staggered maturities — for example one-, two-, three-, four-, and five-year CDs. Each year one rung matures, which you can spend or reinvest in a new five-year CD. Ladders capture the higher rates of longer terms while keeping a portion of your money accessible every year without penalties.
What happens when my CD matures?
Your bank gives you a grace period — typically 7 to 10 days — to withdraw the money, add to it, or move it to a different term. If you do nothing, most banks automatically renew the CD for the same term at the current (not your original) rate, which may be significantly lower. Set a reminder for the maturity date; auto-renewal at a bad rate is the most common CD mistake.
Are CD rates fixed for the whole term?
For a standard CD, yes — the rate is locked at deposit and does not change, which is the main appeal versus a savings account whose rate can drop at any time. Exceptions exist: bump-up CDs let you raise the rate once if rates climb, and variable-rate CDs track an index. Both variants generally start with a lower rate than a comparable fixed CD.