CD Calculator
Free CD calculator to calculate your certificate of deposit maturity value, total interest earned, and APY with different compounding frequencies.
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How to Use This CD Calculator
A certificate of deposit (CD) is a savings product that pays a fixed interest rate for a set term. Use this calculator to estimate how much your CD will be worth at maturity.
Step 1: Enter your initial deposit amount — this is the amount you plan to invest in the CD.
Step 2: Enter the annual interest rate (not APY) offered by your bank or credit union.
Step 3: Select the term length in months — this is how long your money will be locked in.
Step 4: Choose the compounding frequency that matches your CD offering (most CDs compound monthly).
Step 5: Click "Calculate" to see your maturity value, total interest earned, and APY.
Understanding CD Compounding
Compound interest means you earn interest on your interest. When your CD compounds, the earned interest is added to your principal, and future interest is calculated on the new, larger balance.
The more frequently interest compounds, the more you earn. For example, a CD with daily compounding will earn slightly more than the same CD with monthly compounding, because interest is added to your balance more often.
Here's how different compounding frequencies compare for a $10,000 deposit at 4.5% APY over 12 months:
- Monthly: $459.40 interest earned
- Daily: $460.26 interest earned
- Quarterly: $457.65 interest earned
- Annually: $450.00 interest earned
Frequently Asked Questions
A CD calculator helps you determine how much your certificate of deposit will be worth at maturity and how much interest you'll earn based on your initial deposit, interest rate, term, and compounding frequency.
CD interest is calculated using the compound interest formula: FV = P(1 + r/n)^(nt), where P is the principal, r is the annual interest rate, n is the compounding frequency, and t is the time in years.
The interest rate is the annual rate earned on your deposit. APY (Annual Percentage Yield) includes the effect of compounding, giving you the true annual return on your investment.
More frequent compounding means more interest earned. Daily compounding earns slightly more than monthly, which earns more than quarterly, and so on. The difference grows with larger deposits and longer terms.
Yes, interest earned on CDs is typically taxable as ordinary income in the year it's earned, even if you don't withdraw it. Consult a tax professional for your specific situation.
Most banks charge an early withdrawal penalty, typically several months of interest. This penalty can reduce your principal, so CDs are best for money you won't need until maturity.