CD Calculator

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Finance

Calculate the maturity value and total interest earned on a Certificate of Deposit (CD) with compound interest.

Formula

Maturity = P × (1 + APY/n)^(n×t), where t = years, n = compounding frequency
  • APY (Annual Percentage Yield) already reflects compounding. Banks advertise APY, not APR.
  • More frequent compounding slightly increases returns at the same stated rate.
  • Early withdrawal penalties (typically 60–180 days' interest) are not included.

$10,000 CD at 4.5% APY for 12 months

Inputs
  • Initial Deposit: 10000 $
  • APY (Annual Percentage Yield): 4.5 %
  • CD Term: 12 months
  • Compounding Frequency: monthly

Maturity = 10,000 × (1 + 0.045/12)^12 ≈ $10,459.69. Interest = $459.69.

Frequently asked questions

What is APY vs APR?
APR is the nominal rate; APY includes the effect of compounding. For CDs, always compare APY.
What happens if I withdraw early?
Most CDs charge an early withdrawal penalty, typically 60–180 days of interest depending on term.
Are CDs FDIC insured?
Yes — CDs at FDIC-insured banks are insured up to $250,000 per depositor per institution.
How do I maximize CD returns?
Use a CD ladder (stagger maturities) to get higher rates on longer terms while maintaining some liquidity.