CD Calculator
*Calculations are estimates assuming monthly compounding. Actual returns may vary based on bank policies and compounding frequency.
Total Balance at Maturity
$0.00
Total Interest Earned
+$0.00
Performance Comparison
Your CD Selection
@ 4.50% APY
National Average Savings
@ 0.46% APY
Use this Certificate of Deposit (CD) Calculator to determine how much interest you will earn on your deposit. Comparing high-yield CD rates against national averages helps investors maximize their returns. CDs typically offer higher interest rates than traditional savings accounts in exchange for locking your funds for a set period.
A Beginner’s Guide to Certificates of Deposit (CDs)
A safe harbor for your savings in a volatile market.
What is a Certificate of Deposit?
A CD is a special type of savings account you open at a bank or credit union. It's different from a regular savings account in one key way: **Time**. You agree to leave your money in the account for a fixed period (called the "term"), and in exchange, the bank pays you a fixed interest rate that is almost always higher than a standard savings account.
Principal
The initial amount of money you deposit to open the CD. This is your starting investment.
Term
The length of time you agree to keep your money in the account, ranging from 3 months to 5 years or more.
APY
Stands for "Annual Percentage Yield." This is the real rate of return, as it includes the effect of compound interest.
Why a Calculator is Your Best Friend
Calculating compound interest in your head is tricky. A calculator lets you see the future. It shows how small differences in APY can lead to huge differences in earnings over time.
Profit Comparison: 5 Years on $10,000
High-Yield CD (5.0%)
$12,833
Total Balance
National Average (0.5%)
$10,252
Total Balance
Strategy: What is CD Laddering?
CD Laddering solves the "locked-up money" problem. Instead of putting all your cash into one 5-year CD, you split it into a "ladder." This gives you high rates *and* regular access to your money.
Example: A 5-Year Ladder with $10,000
How it works: After 1 year, your first CD matures. You take that $2,000 (plus interest) and reinvest it into a *new* 5-year CD. The next year, your 2-year CD matures, and you do the same. Soon, you have a 5-year CD maturing every single year, giving you liquidity while earning the highest long-term rates.
Key Terms to Know
Maturity Date
The date your term ends and you can withdraw your principal and interest without paying a penalty.
Early Withdrawal Penalty
A fee you pay if you take your money out *before* the maturity date. It's often equal to a few months of interest.
Jumbo CD
A CD that requires a very large minimum deposit (often $100,000 or more) and may offer a slightly higher APY.
Bump-Up CD
A special CD that lets you "bump up" your interest rate once or twice during the term if the bank's rates go up.
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