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CD Calculator
What will your CD actually pay — and what would breaking it early cost? This CD calculator shows the value at maturity, the interest earned, the true APY, and what you would keep after an early-withdrawal penalty. Share any scenario with one link.
See how this works on a $10,000 CD — 3 real examples
Value at maturity (5 years)
$0
Total interest
$0
APY
0%
Initial deposit
$0
After tax at 0%, you keep about $0 of interest.
If you break the CD after 2 years
Balance at withdrawal
$0
Early-withdrawal penalty
−$0
Net proceeds
$0
Breaking early leaves you with less than holding to maturity.
That penalty is larger than the whole balance, so it has been capped — a bank cannot take more than the account holds. Your net proceeds are $0.
Growth to maturity
Year-by-year CD scheduleInterest earned and end balance for each year of the term
| Year | Cumulative interest | End balance |
|---|
How your CD's maturity value and APY are figured
A certificate of deposit grows by the standard compound interest formula:
A = P (1 + r/m)m·t
where P is your initial deposit, r the annual (nominal) rate, m the compounding periods per year and t the term in years (whole years plus any extra months divided by twelve). Continuous compounding uses A = P·er·t.
The APY is the effective yearly yield once compounding is folded in: APY = (1 + r/m)m − 1 (or er − 1 for continuous). APY is the number to compare across banks, because it already accounts for how often each CD compounds. If your bank quotes only an APY, enter it as the rate with compounding set to annually and the APY here will match.
Early-withdrawal penalty. Break the CD early and the penalty is subtracted from your balance at the withdrawal date to give net proceeds. Banks express it four ways, so you choose the one your bank uses: months of interest = P · r · (months / 12), flat amount = the fee itself, % of deposit = P · pct, or % of interest = (balance − P) · pct.
The first three are all charged on your principal, so they can exceed the interest you have earned and eat into your original deposit — exactly what some banks do, and no floor is applied. The fourth is charged on interest alone, so it can never touch your deposit. In every mode the penalty is capped at the balance itself, because a bank cannot collect more than the account holds.
The break-even figure compares those net proceeds against simply holding to maturity. Any tax rate you enter is applied as a flat drag on interest for the after-tax figure; it is not a tax-table calculation.
One CD rate, three term lengths
$10,000 at a quoted 4.5%, compounded monthly — which quietly makes the effective yield 4.59% APY. The only lever here is the clock.
One year: the quickest round trip
at maturity$10,459.40
- The quoted 4.5% becomes an effective 4.59% APY once monthly compounding does its rounds.
- Interest for the year comes to $459.40 — $9.40 more than a once-a-year payout would give.
- After twelve months the full $10,459.40 is back in hand, deposit and interest together.
The fastest exit and the smallest reward: $459.40 for a year of leaving it alone.
Load this example (opens in a new tab)Three years: compounding gets visible
at maturity$11,442.48
- Interest totals $1,442.48 over the three years, at the same 4.59% effective yield.
- Three times the first year's $459.40 would be $1,378.20; compounding adds the other $64.28.
- Each credited month's interest earns its own interest for the rest of the term.
Three years without touching the money buys $1,442.48 — the wait itself is the price.
Load this example (opens in a new tab)Five years: interest earning interest
at maturity$12,517.96
- By year five the interest stands at $2,517.96 — more than five times the first year's take.
- Five flat repeats of the first year would earn $2,297; the extra $220.96 is interest on interest.
- Maturity returns $12,517.96 in one payment, the deposit plus every month's compounding.
Five locked-up years yield $2,517.96 — $220.96 beyond five repeats of year one.
Load this example (opens in a new tab)Illustrations only, not financial advice. Your own rate, taxes and insurance will differ — check with a qualified financial advisor before acting on any of this.
Certificates of deposit, in plain English
- ▸You trade access for a fixed rate. A CD locks your money for the term in exchange for a guaranteed rate — great when rates are falling, restrictive when you might need the cash.
- ▸Compare on APY, not the headline rate. Two CDs with the same rate but different compounding earn different amounts; the APY shown above already bakes that in.
- ▸The early-withdrawal penalty is the real cost of flexibility. Flip to Break-early mode to see net proceeds and whether cashing out still beats leaving your money in savings — or open the dedicated CD Early Withdrawal Penalty Calculator to focus on that alone.
- ▸CD interest is taxable each year. Even if you do not touch the money, you owe tax on the interest annually — enter your rate to see the after-tax figure.
- ▸Ladder to soften the lock-in. Splitting money across staggered terms gives you a maturing rung each year while still capturing longer-term rates.
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Frequently asked questions
How is CD interest calculated?
A certificate of deposit grows by compound interest: A = P(1 + r/m)^(m·t), where P is your deposit, r the annual rate, m the compounding periods per year and t the term in years. Each period the earned interest is added to the balance and begins earning itself. A $10,000 CD at 4.5% compounded monthly for 5 years matures at about $12,518 — roughly $2,518 of CD interest.
What is APY on a CD?
APY (annual percentage yield) is the effective yearly return once compounding is included, so it is the honest number for comparing CDs. It is APY = (1 + r/m)^m − 1. A 4.5% nominal rate compounded monthly works out to an APY of about 4.594%. When two CDs quote different compounding, compare their APYs, not the nominal rates.
What is the penalty for withdrawing from a CD early?
Break a CD before maturity and the bank charges an early withdrawal penalty, usually a set number of months of interest: commonly 3 months on a 1-year CD, 6–12 months on longer terms. Banks word it four ways, all supported here: months of interest, a flat dollar fee, a percentage of your deposit, or a percentage of the interest earned. The penalty comes off the balance to give your net proceeds, and it can eat into your original deposit, but never beyond the balance itself.
Is a CD worth it compared to a high-yield savings account?
A CD locks in a fixed rate for the whole term, which is valuable when rates are falling, but your money is committed and breaking early triggers a penalty. A high-yield savings account stays liquid but its rate can drop at any time. If you are confident you will not need the cash before maturity, a CD often pays a bit more; if you might, the flexibility of savings can be worth the slightly lower yield.
How does a CD ladder work?
A CD ladder splits your money across several CDs with staggered maturities — for example five equal CDs maturing one year apart. Each year one rung matures and you either spend it or roll it into a new long-term CD. This blends the higher rates of long terms with regular access to part of your cash, softening the early-withdrawal trade-off. Model each rung separately in this calculator and add up the results.
Are CDs FDIC insured?
CDs at FDIC-member banks are insured up to $250,000 per depositor, per bank, per ownership category; CDs at credit unions carry equivalent NCUA coverage. That makes a CD one of the lowest-risk places to hold cash. The insurance covers principal and accrued interest up to the limit, so a CD comfortably under that cap is effectively guaranteed.
Disclaimer: these calculators are educational tools, not financial advice. They model your inputs with published formulas, but they cannot know your full situation — for decisions with real stakes, talk to a qualified professional. Formulas and defaults last reviewed .