CD Calculator
Calculate the maturity value and interest earned on a certificate of deposit.
Maturity Value by Term Length
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A certificate of deposit locks your money at a fixed rate for a set term. This calculator shows exactly what you will have when the CD matures:
- Enter your deposit amount. This is how much you plan to put into the CD.
- Enter the annual rate (APR). This is the stated interest rate the bank offers.
- Select the CD term. Choose from 3 months to 60 months. Longer terms typically offer higher rates.
- Select the compounding frequency. Most banks compound daily or monthly. More frequent compounding means slightly more interest earned.
The result updates instantly. The comparison table shows what you would earn at different term lengths, helping you decide which maturity works best for your goals.
About Certificates of Deposit
A CD is a time deposit offered by banks and credit unions. You agree to leave your money deposited for a fixed period (the term), and in return the bank pays a fixed interest rate that is typically higher than a regular savings account. CDs are considered very low risk because they are FDIC-insured up to $250,000 per depositor per bank.
The trade-off is liquidity. If you withdraw early, most banks charge an early withdrawal penalty, often several months of interest. This makes CDs best suited for money you know you will not need during the term. CD laddering, where you split your deposit across multiple CDs with staggered maturity dates, is a popular strategy to balance higher yields with periodic access to funds.
Frequently Asked Questions
What is a certificate of deposit?
A certificate of deposit (CD) is a savings product where you deposit money for a fixed term at a guaranteed interest rate. Unlike a savings account, you cannot withdraw the money before the term ends without paying an early withdrawal penalty. CDs typically offer higher interest rates than regular savings accounts.
Are CDs safe investments?
Yes. CDs at FDIC-insured banks are protected up to $250,000 per depositor per institution. Credit union CDs (called share certificates) are insured by the NCUA for the same amount. Your principal and earned interest are guaranteed, making CDs one of the safest places to park money.
What is a CD ladder?
A CD ladder splits your deposit across multiple CDs with different maturity dates. For example, instead of putting $10,000 in a single 5-year CD, you put $2,000 each into a 1, 2, 3, 4, and 5-year CD. As each CD matures, you reinvest it in a new 5-year CD. This gives you regular access to a portion of your money while still earning longer-term rates.
What happens if I withdraw a CD early?
Most banks charge an early withdrawal penalty, typically ranging from 3 to 12 months of interest depending on the CD term. Some no-penalty CDs exist but usually offer lower rates. Always check the penalty terms before opening a CD to make sure the term fits your timeline.