CD Calculator
Show the math
What Your Result Means
- Value at Maturity: The total amount you will receive when the CD term ends, including your original deposit plus all compounded interest. This is the number your bank will pay out.
- Interest Earned: The difference between the maturity value and your initial deposit — pure growth from compound interest. Longer terms and more frequent compounding increase this amount.
- APY (Annual Percentage Yield): The effective annual return that accounts for compounding. APY is always equal to or higher than the stated nominal rate, and it lets you compare CDs with different compounding frequencies on equal footing.
How This Calculator Works
You enter your initial deposit, the annual interest rate, a term from 3 months to 5 years, and a compounding frequency (daily, monthly, quarterly, or annually). The tool applies the compound interest formula A = P(1 + r/n)^(nt) to compute the maturity value. It then derives APY so you can compare CDs regardless of how often interest compounds. Early withdrawal penalties and taxes are not factored in.
Quick Questions
Does compounding frequency matter much?
For most CD rates, the difference between daily and monthly compounding is small — often just a few cents per thousand dollars. The gap grows with higher rates and longer terms, but APY already bakes in compounding, so compare APY across offers.
What happens if I withdraw early?
Most banks charge an early withdrawal penalty, typically ranging from 3 to 12 months of interest depending on the term. Some brokered CDs can be sold on a secondary market instead, but you may receive less than face value if rates have risen.
Are CD earnings taxable?
Yes. Interest earned on CDs is taxed as ordinary income in the year it is credited, even if you do not withdraw it. Your bank will issue a 1099-INT for any interest over $10.
Is my deposit insured?
CDs held at FDIC-insured banks are covered up to $250,000 per depositor, per institution. Credit union CDs (called share certificates) are similarly insured by the NCUA up to $250,000.
What is the difference between APR and APY?
APR (Annual Percentage Rate) is the nominal rate before compounding. APY (Annual Percentage Yield) reflects the actual return after compounding. For CDs, APY is the more useful number because it tells you what you will actually earn.
Sources
- FDIC — Deposit Insurance (coverage limits and insured product definitions)
- CFPB — What Is a Certificate of Deposit? (CD basics, APY rules, and early withdrawal)
- IRS Topic 403 — Interest Received (taxation of CD interest income)
Method & review
Estimate only. Results reflect your inputs and standard formulas. Double-check important decisions independently.