Calculate the maturity value and total interest earned on a Certificate of Deposit. Adjust deposit amount, APY, term, and compounding to compare CDs across banks.
Enter your deposit amount, the CD’s APY (always compare APY, not APR), the term in months, and the compounding frequency. The calculator shows your final maturity value and the total interest earned. APY already accounts for compounding, so the math here is straightforward and accurate.
A Certificate of Deposit (CD) is a deposit account at a bank or credit union that holds a fixed amount of money for a fixed term — from a few months to several years — in exchange for a guaranteed interest rate. CDs are FDIC-insured up to $250,000 per depositor per bank. They’re among the safest places to put money you don’t need access to.
A CD (Certificate of Deposit) calculator runs the compound interest formula: A = P × (1 + r/n)^(n×t), where P is the principal, r is the annual rate, n is the compounding periods per year, and t is years. Most CDs publish APY (annual percentage yield), which already accounts for compounding — the calculator above uses APY directly to give you the actual maturity value.
APR (annual percentage rate) is the simple interest rate. APY (annual percentage yield) is the effective rate after compounding. APY is always the more accurate number for what you'll actually earn. For example, a 5% APR with daily compounding produces roughly 5.13% APY. Banks legally must disclose APY for deposit accounts, so always compare APY to APY across CDs.
CD interest is taxed as ordinary income at your marginal federal rate (plus state, where applicable) in the year it's credited — not when the CD matures. For high-income earners in the 32-37% federal bracket, a 5% APY CD nets closer to 3.2-3.4% after federal tax. CDs held in tax-advantaged accounts (IRA, 401(k)) defer or eliminate this tax.
Yes. CDs at FDIC-insured banks are guaranteed up to $250,000 per depositor, per bank, per ownership category. Joint accounts are insured up to $500,000. To insure more than $250,000, use multiple banks or a CDARS-style network. Credit union CDs have equivalent NCUA insurance.
A CD ladder spreads your money across multiple CDs with staggered maturity dates (e.g., 1-year, 2-year, 3-year, 4-year, 5-year). Each year one CD matures, giving you liquidity, and you reinvest at the longest term to capture higher rates. Laddering balances rate risk and liquidity. It works best in stable or rising rate environments.
Early withdrawal triggers a penalty, typically 3–6 months of interest for short-term CDs and 6–12 months for longer terms. Some "no-penalty" CDs exist but pay lower APYs. If there's any chance you'll need the money before maturity, a high-yield savings account at a comparable APY is usually a better fit — same rate, full liquidity.
Sometimes. CDs typically pay slightly more (0.25–1% higher APY) in exchange for locking up your money. In a falling-rate environment, locking in today's higher rate via a CD wins. In a rising-rate environment, an HYSA wins because it floats up automatically. For an emergency fund or any "might need this" money, an HYSA is almost always the better fit.
Brokered CDs (sold through Fidelity, Schwab, etc.) often offer higher APYs than bank CDs and let you compare hundreds of issuers in one place. The trade-off: brokered CDs trade on a secondary market — if you sell early, you take whatever the market price is, which could be more or less than your principal. Direct bank CDs have a fixed early-withdrawal penalty instead.
For high-income earners, the bigger question is rarely “which CD?” It’s “which dollars belong in a CD vs. equities vs. tax-advantaged accounts?” A 5% CD looks attractive until you compare it to a Roth 401(k) at the long-term equity return of ~10%, untaxed.
The HomeCFO Program teaches the household-CFO framework for asset location — what dollar belongs where, and why.
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