📜 CD Calculator

Find out exactly what a certificate of deposit pays you when the term ends.

How it works

A certificate of deposit locks your money away for a fixed term at a fixed rate. Because banks quote that rate as APY — which already bakes in compounding — the maths is direct: Interest = Deposit × ((1 + APY)^months/12 − 1). A 12-month CD therefore earns exactly its APY on the deposit; a 6-month CD earns roughly half a year of it.

The catch is access. Take the money out early and the bank claws back several months of interest as a penalty, which is why CDs suit money you are sure you will not need during the term.

An example

Deposit $10,000 in a 12-month CD paying 4.5% APY. At maturity you earn $450.00 in interest, and the CD pays out $10,450.00 in total. No surprises either way — that certainty, along with federal deposit insurance at most banks, is the whole appeal of a CD compared with leaving the money in a variable-rate account that could drop its rate mid-year.

Common questions

What happens if I withdraw from a CD early?

The bank charges an early-withdrawal penalty, commonly 3–6 months of interest, and it can eat into your original deposit on longer terms. Only lock away money you can genuinely leave alone.

Is a CD better than a high-yield savings account?

It depends on rates and flexibility. A CD wins when its APY is higher and you will not need the money; a savings account wins when rates are rising or you want access at any time.

What is a CD ladder?

Splitting your money across CDs of different terms — say 1, 2 and 3 years — so part of it matures every year. You get some of the higher long-term rates without locking everything away at once.

Related calculators

This calculator gives estimates for learning. Rates, taxes and rules change, and your lender or the IRS has the final numbers — check big decisions against the real documents.