CD (Certificate of Deposit) Calculator
FinanceCalculate the maturity value, interest earned, and effective APY on a certificate of deposit, with your choice of compounding frequency.
Maturity Value
The total value of the CD at maturity, including compounded interest.
Total Interest Earned
$459.40
The total interest earned over the CD term.
Effective APY
4.594%
The annualized yield after accounting for compounding, comparable across CDs with different compounding frequencies.
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Finance calculators
This calculator finds the maturity value, total interest earned, and effective annual percentage yield (APY) for a certificate of deposit, based on your deposit amount, annual interest rate, term, and compounding frequency. Enter your deposit amount, the annual interest rate offered by your bank, and the CD's term in months to see how much your money grows by maturity.
Set the Compounding Frequency field to match how your specific CD compounds, daily, monthly, quarterly, semiannually, or annually. More frequent compounding produces a slightly higher maturity value for the same nominal interest rate, since interest starts earning interest sooner. If your bank quotes an APY directly rather than a nominal rate, compare it against the Effective APY result here to check the two figures line up.
The formulas, a worked comparison across compounding frequencies, and answers to common questions about how CDs work are below.
How to calculate CD maturity value
Maturity value is the deposit amount multiplied by 1 plus the periodic interest rate, raised to the power of the number of compounding periods over the term. For example, a 10,000 dollar deposit at 4.5 percent annual interest, compounded monthly, over a 12 month term: the monthly rate is 4.5 divided by 12, or 0.375 percent, applied 12 times, which grows the deposit to 10,459.40 dollars, or 459.40 dollars in interest.
For general compound-growth math beyond CDs specifically, see the Compound Interest Calculator. For the annualized yield figure on its own, without needing a deposit amount, see the APY Calculator.
Understanding compounding frequency
The same nominal interest rate produces a slightly different maturity value depending on how often interest compounds. Here is a real comparison for a 10,000 dollar deposit at 4.5 percent for 12 months:
| Compounding Frequency | Maturity Value | Interest Earned | Effective APY |
|---|---|---|---|
| Daily | $10,460.25 | $460.25 | 4.602% |
| Monthly | $10,459.40 | $459.40 | 4.594% |
| Quarterly | $10,457.65 | $457.65 | 4.577% |
| Semiannually | $10,455.06 | $455.06 | 4.551% |
| Annually | $10,450.00 | $450.00 | 4.500% |
The difference between daily and annual compounding here is only about 10 dollars on a 10,000 dollar deposit, real but modest. It grows larger with a bigger deposit, a higher rate, or a longer term.
APY vs. nominal interest rate
The nominal, or stated, interest rate is the rate before accounting for compounding. The effective APY is the actual annualized return after compounding is applied, which is always equal to or slightly higher than the nominal rate. Banks are required to disclose the APY, so it is the correct figure to use when comparing CDs from different banks that compound on different schedules.
This calculator's Effective APY result lets you check a bank's advertised APY directly, or compare two CDs on equal footing even if one bank compounds daily and another compounds monthly.
What is a CD ladder
A CD ladder splits one lump sum across several CDs with staggered terms, for example 1, 2, 3, and 4 year terms, rather than putting it all into a single CD. As each CD matures, you can either withdraw the funds or reinvest at the current rate, which gives regular access to part of your money while still earning the typically higher rates that longer terms offer. Run each rung of the ladder through this calculator separately, using its own term and rate, to see its individual maturity value.
Frequently Asked Questions
What is a certificate of deposit?
A certificate of deposit is a fixed-term savings product offered by banks and credit unions that typically pays a higher, locked-in interest rate than a standard savings account, in exchange for not withdrawing the funds until maturity.
What happens if I withdraw from a CD before maturity?
Most CDs charge an early withdrawal penalty, often calculated as a number of months of interest, which can reduce or in some cases exceed the interest earned if withdrawn very early in the term.
Is CD interest compounded the same way at every bank?
No. Compounding frequency varies between institutions, daily, monthly, quarterly, or otherwise. Set the Compounding Frequency field above to match your own CD, or compare the Effective APY result directly against your bank's advertised APY.
What's the difference between APY and interest rate?
The interest rate, or nominal rate, is the stated rate before compounding. APY is the actual annualized return after compounding is applied, and is always equal to or slightly higher than the nominal rate. Use APY to compare CDs fairly across banks.
Does more frequent compounding actually make a big difference?
It is real but usually modest for typical CD terms and rates. On a 10,000 dollar deposit at 4.5 percent for one year, daily compounding earns about 10 dollars more than annual compounding. The difference grows with a larger deposit, a higher rate, or a longer term.
What is a CD ladder?
A CD ladder splits your money across several CDs with staggered terms instead of one single CD, giving you regular access to part of your funds as each one matures while still earning longer-term rates on the rest.
Is CD interest taxable?
Yes. CD interest is taxed as ordinary income in the year it is earned, even if the CD has not yet matured, and your bank will report it to you on a 1099-INT form.
Can I add more money to a CD after opening it?
Usually not. Standard CDs are opened with a single lump-sum deposit and do not accept additional deposits during the term. Some banks offer a separate add-on CD product that does allow this, but it is not the default.
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