CD Calculator

Calculate your earnings and more

Use this CD calculator to find out how much interest is earned on a certificate of deposit (CD). Just enter a few pieces of information and this CD calculator will calculate the annual percentage yield (APY) and ending balance. Click on the "View Report" button to see a detailed schedule of the CD's balance and interest earned.

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Definitions

INITIAL DEPOSIT
The starting balance for your CD.
MONTHS
The total number of months for this CD to mature.
INTEREST RATE
The published interest rate for this CD. Make sure to enter the actual interest rate, not the annual percentage yield (APY). It is important to remember that these scenarios are hypothetical and that future interest rates can't be predicted with certainty.
COMPOUNDING
Interest earned on your CD's accumulated interest. This calculator allows you to choose the frequency that your CD's interest income is adived to your account. The more frequently this occurs, the sooner your accumulated interest income will generate adivitional interest. You may wish to check with your financial institution to find out how often interest is being compounded on your particular CD.
ANNUAL PERCENTAGE YIELD (APY)
This is the effective annual interest rate earned for this CD. A CD's APY depends on the frequency of compounding and the interest rate. Since APY measures your actual interest earned per year, you can use it to compare CD's of different interest rates and compounding frequencies.
METHODOLOGY - HOW DO YOU CALCULATE YIELD?
Annual percentage yield (APY) is calculated by using this formula: APY= (1 + r/n )n n – 1. In this formula, “r” is the stated annual interest rate and “n” is the number of compounding periods each year.
HOW MUCH INTEREST CAN YOU EARN ON A CD
TThe amount of interest you can earn on a CD depends on what the APY is, how long the term of the CD is and the frequency of compounding. The more frequent the compounding, the more your money will grow over time. Generally, CDs compound on a daily or monthly basis.
DO CDs PAY DAILY, MONTHLY, OR YEARLY
The answer varies by account, but most CDs credit interest monthly. Some may allow you to have the interest transferred to a different account, such as a savings account or a money market account. How often CDs credit interest is one factor. The other factor is how often the CD compounds. Generally, CDs compound daily or monthly. The more often the CD compounds, the faster your savings will grow.
DEFINE THE MINIMUM DEPOSIT FOR A CD
There are CDs that have either a $0 minimum deposit or low minimum deposits. These low-minimum CDs mean that almost anyone can get one and become a saver – assuming you don’t need the funds for the duration of the CD. If you do, you may incur an early withdrawal penalty that could take away from your principal – the original amount that you invested. While you can open a CD with a small amount of money, the more money you deposit into the CD the more interest you’ll earn. Compare the minimum required deposit with the APYs and find the one that best fits your financial situation.
HOW DO CDs DIFFER WHEN COMPARED WITH SAVINGS ACCOUNTS AND MONEY MARKET ACCOUNTS?
CDs are locked in for a certain period. This term can be as little as one month or as long as 10 years (though five years is typically the longest term). Savings accounts and money market accounts are liquid accounts, meaning they can generally be accessed at any time. They also can be used for limited transactions. For instance, some savings accounts and money market accounts allow you to access your money through an ATM with an ATM card. Some savings accounts and money market accounts may also allow you to send money via a wire transfer. Generally, these transactional functions aren’t allowed with a CD. Generally, a CD can only be accessed during a 10-day grace period (the number of days varies by bank) that starts on the CD maturity date. If a CD is accessed early, an early withdrawal fee will likely be assessed. CD withdrawal options are generally restricted to either a cash withdrawal or a transfer to a checking account, savings account or a money market account.

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