Audited —·Last updated 27 Jul 2026·6 citations·Tier 1·0 uses

CD Calculator

Free CD calculator. Project final balance, interest, and APY on any certificate of deposit, plus the early withdrawal penalty if you cash out before maturity.

CD Calculator

The amount you deposit into the CD at opening. Most banks set a minimum of $500-$2,500; jumbo CDs typically start at $100,000.
$
The bank's stated nominal annual rate. Enter the APR (Reg DD calls this the 'interest rate'), not the APY — the calculator derives APY for you.
%
Length of the CD in months. Common terms: 3, 6, 9, 12, 18, 24, 36, 48, 60. Maximum 120 months (10 years).
months
Compounding Frequency
Months of interest forfeited if you break the CD before maturity. Typical: 3 months for terms under 1 year, 6 months for 1-5 year, 12 months for 5+ year. Read your account disclosure.
months of interest
Balance at Maturity
$10,512.67
The full balance after the CD term ends, computed as A = P(1 + r/n)^(nt). This is what the bank will credit to your linked account at maturity.
Interest Earned
$512.67
APY (Annual Percentage Yield)
5.13%
Early Withdrawal Penalty
$125.00
Net If Withdrawn Early
$10,387.67

Background.

This CD calculator projects exactly how much a certificate of deposit will be worth at maturity, what its true annual percentage yield is once compounding is included, and what an early withdrawal would cost if you have to break it before the term ends. A certificate of deposit is a time deposit issued by a federally insured bank (FDIC) or credit union (NCUA share certificate) that locks your money up for a fixed term — typically anywhere from three months to ten years — in exchange for a guaranteed interest rate that is usually higher than what the same institution pays on a checking, savings, or money market account. Because the contract is a promise to leave the money on deposit for the entire term, the bank can fund longer-dated assets with it and pass some of the yield premium back to you. The trade-off is liquidity: pull the money out before maturity and the bank assesses an early withdrawal penalty, typically expressed as a number of months of interest forfeited.

The Federal Deposit Insurance Corporation insures each depositor at each insured bank up to $250,000 per ownership category, so a CD at an FDIC-insured institution carries essentially zero credit risk up to that limit; brokered CDs purchased through a brokerage may aggregate across multiple banks to extend that coverage.

Two numbers matter when you shop for a CD, and they are not the same: the APR (the nominal annual interest rate stated on the disclosure) and the APY (annual percentage yield, the effective rate after compounding). Federal Reserve Regulation DD, the implementing rule for the Truth in Savings Act now administered by the Consumer Financial Protection Bureau, requires every depository institution to advertise CDs using APY computed by a single statutory formula — APY = (1 + r/n)^n - 1, where r is the periodic rate per compounding interval and n is the number of compounding periods per year. That formula is the same one this calculator uses internally, and it is the only fair way to compare a CD that compounds daily against one that pays simple interest at maturity or compounds semiannually like most brokered CDs. The current rate environment makes the comparison especially consequential: short-term CDs have repriced sharply alongside the Federal Reserve's target federal funds rate, and the spread between a 12-month CD and a 5-year CD frequently inverts during tightening cycles — meaning the highest APY in the market is often available on the shortest term, which is the opposite of the textbook upward-sloping yield curve. The Federal Reserve's H.15 Selected Interest Rates release and Bankrate's National Average CD Rates survey are the two primary-source benchmarks for what a fair APY looks like at any given moment; if your bank is paying meaningfully less, you are leaving money on the table.

The other strategy this calculator is built to support is the CD ladder: rather than putting the full deposit into a single five-year CD, you split it into five equal rungs of one-, two-, three-, four-, and five-year CDs. Each year one rung matures and is rolled into a fresh five-year CD, so within five years the entire ladder is earning the (typically higher) five-year rate while one-fifth of it is always within twelve months of liquidity. Run the calculator once per rung at the rate the bank is quoting for that term, sum the maturity values, and you have a complete ladder projection.

The fields below let you specify the deposit, the APR, the term in months, the compounding frequency, and the early withdrawal penalty in months of interest forfeited. The widget returns the maturity balance, total interest, the Reg DD-compliant APY, the penalty dollar amount, and the net you would walk away with if you broke the CD today. Below the widget you will find a full algebraic breakdown of the formula, a worked $10,000 / 5% / 12-month example that matches the canonical textbook problem, eight long-tail FAQs covering CD versus high-yield savings, APR versus APY, early withdrawal mechanics, the $250,000 FDIC limit, CD laddering, and the special structure of brokered CDs, and primary-source citations to Regulation DD (12 CFR Part 1030), FDIC Consumer News, NCUA share certificate rules, the Federal Reserve H.15 statistical release, and the Bankrate national CD average survey. Read past the calculator if you want to understand how the bank's quoted rate becomes the dollar amount on the maturity ticket.

What is cd calculator?

A certificate of deposit (CD) is a savings product issued by a federally insured depository institution under which you deposit a fixed principal amount for a fixed term at a fixed interest rate, and the institution promises to return the principal plus all accrued interest at the end of the term. Unlike a checking or savings account, you cannot withdraw the funds during the term without paying an early withdrawal penalty disclosed in the account agreement. CDs issued by FDIC-member banks are insured up to $250,000 per depositor per ownership category under 12 CFR Part 330; CDs issued by NCUA-insured credit unions (called share certificates) carry equivalent coverage under 12 CFR Part 745. The interest rate is quoted as an APR (the nominal annual rate) and an APY (annual percentage yield), where the APY incorporates the effect of intra-year compounding using the Regulation DD formula APY = (1 + r/n)^n - 1. Most retail CDs compound daily and credit interest monthly; brokered CDs purchased through a brokerage firm often pay simple interest semiannually with no compounding and are not equivalent to a daily-compound retail CD even at the same APR. CDs sit between high-yield savings (fully liquid, variable rate) and bonds (typically longer dated, exposed to interest-rate risk if sold before maturity) on the risk-liquidity spectrum. Their main role in a portfolio is as a short-to-intermediate cash-equivalent allocation with a yield premium over savings accounts in exchange for term commitment.

How to use this calculator.

  1. Enter the Deposit Amount — the amount you are putting into the CD at opening. Most retail CDs require $500-$2,500; jumbo CDs start at $100,000.
  2. Enter the Annual Interest Rate (APR) the bank or credit union is quoting. Use the nominal rate, not the APY — the calculator computes the APY for you using the Regulation DD formula.
  3. Enter the Term in months. Common terms are 3, 6, 9, 12, 18, 24, 36, 48, and 60 months. The calculator supports any term from 1 to 120 months.
  4. Select the Compounding Frequency. Daily is the standard for FDIC-insured retail CDs; brokered CDs typically compound semiannually. Check the account disclosure if you are unsure.
  5. Enter the Early Withdrawal Penalty as a number of months of interest forfeited. Typical figures: 3 months for terms under 12 months, 6 months for 1-5 year terms, 12 months for 5+ year terms. The exact number is in your account disclosure under the heading 'Early Withdrawal Penalty'.
  6. Read the outputs. Balance at Maturity is the headline number — what the bank will pay you when the term ends. Interest Earned is the gain over your deposit. APY is the Reg DD figure you should use to comparison-shop. Early Withdrawal Penalty and Net If Withdrawn Early let you stress-test what would happen if you needed the cash early.
  7. To model a CD ladder, run the calculator once per rung at the rate your bank is quoting for each term, then sum the Balance at Maturity values to project the full ladder.

The formula.

A = P × (1 + r⁄n)^(nt)
A · balance at maturityP · depositr · annual raten · compounds per yeart · term in years

Compound growth in a CD follows the standard time-value-of-money formula A = P(1 + r/n)^(nt), where A is the balance at maturity, P is the principal deposited, r is the annual nominal interest rate expressed as a decimal (a 5% APR is r = 0.05), n is the number of compounding periods per year (365 for daily, 12 for monthly, 4 for quarterly, 2 for semiannually, 1 for annually), and t is the term in years (a 12-month CD has t = 1; an 18-month CD has t = 1.5). The interest earned is simply A - P. The annual percentage yield, which is the figure depository institutions are required by Regulation DD (12 CFR Part 1030, the Truth in Savings rule) to advertise alongside the nominal rate, is computed using a separate statutory formula: APY = (1 + r/n)^n - 1. Note that APY is independent of the term: it tells you the effective annual rate you would earn if the compounding pattern continued for a full year, which makes it a clean apples-to-apples comparator across CDs of different terms and across CDs versus high-yield savings accounts. For a 5% APR compounded daily, the APY works out to (1 + 0.05/365)^365 - 1 = 5.1267%, the canonical textbook number. The early withdrawal penalty in this calculator is modeled using the simple-interest approximation that almost every U.S. retail bank actually uses in practice: penalty = P x r x (penaltyMonths / 12). For a $10,000 CD at 5% with a 3-month penalty that is 10,000 x 0.05 x 0.25 = $125. The penalty is computed on the original principal, not on the accrued balance, and under Federal Reserve guidance the bank may invade principal if the accrued interest at the time of withdrawal is insufficient to cover it — meaning if you break a brand-new CD that has barely earned anything, you can actually walk away with less than you deposited. The net-after-penalty output makes that scenario explicit. All arithmetic in this calculator runs through arbitrary-precision Decimal.js, so the rounding error that appears in spreadsheet-based estimates of (1 + r/n)^(nt) for daily compounding (where the exponent is in the thousands) does not show up in the output.

A worked example.

Example

Take the canonical introductory example: deposit $10,000 into a 12-month FDIC-insured CD at a 5% APR with daily compounding and a standard 3-month early withdrawal penalty. The compound formula gives A = 10000 x (1 + 0.05/365)^(365 x 1) = 10000 x 1.0512674 = $10,512.67 — meaning the bank credits $512.67 of interest over the year, the textbook figure that appears in every introductory finance course. The APY is (1 + 0.05/365)^365 - 1 = 5.1267%, which is the rate the bank is required by Regulation DD to advertise as the APY on the rate sheet. Notice that the APY is 12.67 basis points higher than the stated 5% APR — that gap is the value of daily compounding, and it is exactly why APY rather than APR is the right comparator when you are shopping CDs against high-yield savings accounts. The early withdrawal penalty is 10000 x 0.05 x (3/12) = $125. If you broke this CD the day before maturity, you would walk away with $10,512.67 - $125 = $10,387.67 — still positive, because the accrued interest substantially exceeds the penalty by month 12. If you had broken the same CD in month 2, however, you would have accrued only about $83 in interest against a $125 penalty, and federal rules would allow the bank to invade $42 of your original principal to make up the shortfall — leaving you with roughly $9,958 on a $10,000 deposit. The calculator returns Balance at Maturity = $10,512.67, Interest Earned = $512.67, APY = 5.1267%, Early Withdrawal Penalty = $125, and Net If Withdrawn Early = $10,387.67, matching the hand calculations exactly.

principal10,000
annual Rate Percent5
term Months12
early Withdrawal Penalty Months3
compounding Frequencydaily

Frequently asked questions.

What is the difference between a CD and a high-yield savings account?
Both are FDIC-insured deposit products and both pay an APY computed under the same Regulation DD formula, but they trade off differently between rate and liquidity. A high-yield savings account (HYSA) is fully liquid — you can withdraw at any time without penalty — but the bank can change the interest rate at any time, often within days of a Federal Reserve target rate change. A CD locks the rate in for the full term, which is a feature when rates are falling (you keep earning the old higher rate) and a bug when rates are rising (you are stuck at the old lower rate, or you pay the early withdrawal penalty to break free). In flat-rate environments CDs typically pay 25-100 basis points more than the same bank's HYSA in exchange for the term commitment. The right choice depends on your view of where short-term rates are going and how soon you actually need the cash. Many savers use a barbell approach: an HYSA for emergency liquidity plus a CD ladder for incremental yield on cash they do not expect to touch.
What is the difference between APR and APY on a CD?
APR (annual percentage rate) is the nominal annual interest rate the bank quotes before accounting for the effect of intra-year compounding. APY (annual percentage yield) is the effective annual rate after compounding, computed using the Regulation DD statutory formula APY = (1 + r/n)^n - 1, where r is the nominal annual rate and n is the number of compounding periods per year. For a 5% APR compounded daily, the APY is 5.1267%. For the same 5% APR compounded annually, the APY is exactly 5%. Federal Reserve Regulation DD (12 CFR Part 1030, the Truth in Savings rule, now enforced by the Consumer Financial Protection Bureau) requires every depository institution to advertise CDs using APY computed by this single formula, so APY is the right number to use when comparison shopping across banks. Always compare APY to APY — comparing one bank's APY to another's APR will systematically make the APR-quoting institution look better than it actually is.
What is an early withdrawal penalty and how is it calculated?
An early withdrawal penalty is the amount a bank deducts if you close a CD before its maturity date. It is disclosed in the account agreement under Regulation DD and is almost always expressed as a number of months of simple interest on the original principal: penalty = P x r x (months/12). Typical structures are 3 months of interest for CDs under 12 months, 6 months for 1-5 year terms, and 12 months for terms longer than 5 years. The penalty is the same number of dollars whether you withdraw on day one or one day before maturity, which has two consequences. First, breaking a CD long after opening it is much less painful than breaking one shortly after opening it because the accrued interest by then easily covers the penalty. Second, federal regulators allow the penalty to invade principal — meaning if you break a CD in its first few weeks the bank can take back not just all of your accrued interest but also a slice of your original deposit. Some CDs, marketed as 'no-penalty' or 'liquid' CDs, waive this rule after a short initial holding period, typically seven days, in exchange for a slightly lower APY.
How does FDIC insurance work on CDs and what is the $250,000 limit?
The Federal Deposit Insurance Corporation insures deposits at every FDIC-member bank up to $250,000 per depositor per insured bank per ownership category. Ownership categories are defined in 12 CFR Part 330 and include single accounts, joint accounts, certain retirement accounts, revocable trusts, irrevocable trusts, and a few others. A single depositor at a single bank therefore has $250,000 of coverage on a single-ownership CD, plus another $250,000 on a joint CD with a spouse (allocated $250,000 per co-owner), plus another $250,000 on an IRA CD at the same bank. Credit union deposits are insured under an equivalent regime by the National Credit Union Administration (NCUA) under 12 CFR Part 745. To extend coverage beyond a single bank's limits without managing relationships at multiple institutions, savers often use brokered CDs purchased through a brokerage account; the brokerage spreads the funds across multiple FDIC-insured banks and aggregates the coverage. Note that the limit applies to principal plus accrued interest combined, so if you deposit $250,000 into a 5-year CD the accrued interest is technically uninsured. In practice this matters only at jumbo deposit levels.
What is a CD ladder and how do I build one?
A CD ladder is a portfolio construction in which you split a single deposit across multiple CDs with staggered maturities — typically five rungs at 1, 2, 3, 4, and 5 years. Each year as the shortest rung matures, you roll it into a fresh 5-year CD at the back of the ladder. After year five every dollar in the ladder is earning the (usually higher) 5-year rate, while one-fifth of the ladder is always within 12 months of maturity, giving you de facto annual liquidity. The structure neutralizes most of the interest-rate timing risk involved in choosing a single CD term: if rates rise, the rung maturing this year reprices upward; if rates fall, the rungs locked in last year continue to earn the old higher rate. To build a $50,000 ladder you would open five $10,000 CDs at the rates the bank is currently quoting for 12, 24, 36, 48, and 60 months. Run this calculator once per rung at the corresponding term and rate, sum the Balance at Maturity values to project the ladder's full payoff, and revisit annually as each rung matures. Brokered CD ladders can be built on a brokerage platform with one or two clicks across multiple issuing banks.
What is a brokered CD and how is it different from a bank CD?
A brokered CD is a CD issued by a bank but sold through a brokerage firm rather than directly at a bank branch. The underlying credit and FDIC insurance come from the issuing bank up to the standard $250,000 limit, but several mechanics differ from a retail bank CD. Most brokered CDs pay simple interest at a stated frequency (usually semiannually) rather than compounding daily, so the APY equals the APR — meaning a 5% brokered CD has a 5% APY, lower than a 5% retail CD compounded daily. Most brokered CDs cannot be redeemed early at all; if you need liquidity you must sell the CD on the secondary market, where the price moves inversely with prevailing interest rates exactly like a bond. That market-price risk is the brokered CD's main downside versus a retail CD's fixed early withdrawal penalty. The main advantages are easier laddering across multiple issuing banks (FDIC coverage stacks up to the per-bank limit at each issuer), no minimum at most brokerages above the per-CD denomination (typically $1,000), and access to specialized features like step-up CDs, callable CDs, and zero-coupon CDs. Read the offering memorandum carefully — callable brokered CDs allow the issuing bank to redeem early at par if rates fall, which transfers the reinvestment risk to you.
Are CD interest payments taxable?
Yes. Interest earned on a CD is taxable as ordinary income in the year it is paid or credited, regardless of whether you withdraw it. The issuing bank reports it to the IRS on Form 1099-INT if the amount exceeds $10, and you report it on Schedule B of your federal Form 1040. There is no preferential capital-gains treatment — CD interest is taxed at your marginal ordinary income rate, which can be as high as 37% federally plus state income tax. This is one structural disadvantage of CDs versus Treasury bills and Treasury notes, which are exempt from state and local income tax under federal law (31 USC 3124(a)) and can therefore deliver a higher after-tax yield to investors in high-tax states even at a slightly lower pre-tax APY. CDs held in a traditional IRA or Roth IRA grow tax-deferred or tax-free respectively, eliminating this disadvantage. If you break a CD and pay an early withdrawal penalty, the penalty is deductible as an adjustment to income on Schedule 1 — meaning you do not need to itemize to take it.
Should I lock in a long CD term or stay short when rates are high?
There is no universally correct answer because the question depends on a forecast of future short-term rates, which is exactly what the bond market spends every day trying to figure out and rarely gets right. The textbook approach is to use the Treasury yield curve as a market-implied forecast: if the 5-year Treasury yields less than the 1-year, the market is forecasting that short rates will fall over the next five years, and locking in a 5-year CD at today's higher rate captures that decline. If the curve is upward-sloping, the market is forecasting rising short rates and you might do better staying short and reinvesting. In practice most savers do not have a strong rate view and benefit from a CD ladder, which mechanically averages across the curve and removes the forecasting problem. The one situation in which locking in a long CD is clearly attractive is when the Federal Reserve is at the end of a tightening cycle and short-term CD APYs are high but the curve is starting to flatten — a configuration the H.15 release shows roughly every business cycle. The opposite situation, locking in a long CD at the trough of a cutting cycle when curves are steep, is reliably a bad trade.

References& sources.

  1. [1]Consumer Financial Protection Bureau — Regulation DD (Truth in Savings Act), 12 CFR Part 1030. Defines the APY computation formula APY = (1 + r/n)^n - 1 and the disclosure requirements every depository institution must follow when advertising a CD.
  2. [2]Federal Deposit Insurance Corporation — Consumer News: Certificates of Deposit Tips for Savers. FDIC explainer covering CD mechanics, the $250,000 deposit insurance limit, ownership categories, and early withdrawal penalties.
  3. [3]National Credit Union Administration — Share Insurance Coverage: Share Certificates. The NCUA's equivalent regime for credit union CDs ('share certificates') with the same $250,000 per-depositor coverage under 12 CFR Part 745.
  4. [4]Federal Reserve Board — Statistical Release H.15: Selected Interest Rates. The Federal Reserve's daily release of benchmark short-term rates (Treasury bills, federal funds, commercial paper) against which retail and brokered CD APYs should be sanity-checked.
  5. [5]Bankrate — National Average CD Rates Survey. Weekly survey of national average APYs across 3-month, 6-month, 1-year, 2-year, and 5-year terms, the standard reference benchmark used by personal finance journalists and rate-shoppers.
  6. [6]Federal Deposit Insurance Corporation — 12 CFR Part 330: Deposit Insurance Coverage. The regulation that defines depositor ownership categories and the per-category, per-bank, per-depositor $250,000 insurance limit.
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