Certificate of Deposit (CD) Calculator - Calculate CD Interest & Returns
Certificate of Deposit (CD) Calculator
Investment Growth Analysis:
Amortization & Accumulation Schedule
Portfolio Performance Metrics
Visual representation of your Investment growth showing additional deposits, balance progression, and interest accumulation over time.
What is a Certificate of Deposit (CD)?
A Certificate of Deposit (CD) is a time deposit offered by banks and credit unions that typically offers a higher interest rate than regular savings accounts in exchange for leaving your money untouched for a fixed period. CDs are considered one of the safest investment options as they are typically insured by the FDIC up to $250,000 per depositor.
How Our CD Calculator Works
Our comprehensive CD calculator helps you determine the potential returns on your certificate of deposit investment. Simply enter your initial deposit amount, annual interest rate, term length, and compounding frequency to see detailed projections including:
- Final maturity value
- Total interest earned
- Tax implications
- Monthly and annual growth breakdown
- Visual charts showing growth over time
CD Interest Rate Formula
The compound interest formula used in CD calculations is:
Where:
- A = Final amount
- P = Principal (initial deposit)
- r = Annual interest rate (decimal)
- n = Number of times interest compounds per year
- t = Time in years
Types of CD Compounding
- Daily Compounding: Interest calculated and added daily (365 times per year)
- Monthly Compounding: Interest calculated and added monthly (12 times per year)
- Quarterly Compounding: Interest calculated and added quarterly (4 times per year)
- Annual Compounding: Interest calculated and added once per year
CD Term Options
Common CD terms include:
- 3-month CDs
- 6-month CDs
- 1-year CDs
- 2-year CDs
- 3-year CDs
- 5-year CDs
- 10-year CDs
What happens if I withdraw money from my CD early?
Most CDs impose early withdrawal penalties, typically ranging from a few months to a year's worth of interest, depending on the CD term and bank policies.
Are CD earnings taxable?
Yes, CD interest earnings are generally subject to federal and state income taxes in the year they are earned, even if you don't withdraw the funds.
What's the difference between APY and interest rate?
APY (Annual Percentage Yield) includes the effect of compounding, while the interest rate is the base rate before compounding. APY gives you a more accurate picture of your actual returns.
How often is CD interest compounded?
This varies by bank and CD product. Common compounding frequencies include daily, monthly, quarterly, and annually. More frequent compounding generally results in higher returns.
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