CD Calculator

How it works

Calculate the earnings and total balance of a Certificate of Deposit (CD) over time.

Forecast the growth of your Certificate of Deposit

Description

The CD Calculator helps you determine exactly how much interest your Certificate of Deposit (CD) will earn by the end of its term. By entering your initial deposit and the bank’s offered APY, you can visualize the growth of your fixed-term investment and see the final balance available at maturity.

Inputs

• Deposit Amount: The initial sum of money you place into the CD ($).
• Term Length (Months): The duration of the CD in months (e.g., 6, 12, 18, 60).
• Annual Percentage Yield (APY): The effective annual rate of return offered by the financial institution (%).

Outputs

• Total Balance: The final value of the CD at the end of the term.
• Total Interest Earned: The specific dollar amount of interest accrued during the period.

Chart

• Growth Over Time Area Chart: Displays the month-by-month accumulation of value until maturity.

“Good to Know”

• CD rates are usually fixed for the entire term, protecting you from falling interest rates in the market.
• Withdrawal before the term ends usually results in an “early withdrawal penalty,” which can significantly reduce your interest earnings or even eat into your principal.
• APY accounts for the effects of compounding throughout the year, making it the most accurate rate to use for comparison between different CD products.

Examples

Example 1: Standard 1-Year CD

• Input:
  • Deposit: $10,000
  • Term: 12 Months
  • APY: 4.5%
• Output:
  • Total Balance: $10,450
  • Total Interest: $450

Example 2: Long-Term 5-Year CD

• Input:
  • Deposit: $5,000
  • Term: 60 Months
  • APY: 4.0%
• Output:
  • Total Balance: ~$6,083
  • Total Interest: ~$1,083

Example 3: Short-Term 6-Month CD

• Input:
  • Deposit: $20,000
  • Term: 6 Months
  • APY: 5.0%
• Output:
  • Total Balance: ~$20,494
  • Total Interest: ~$494