CD Calculator
Calculate the interest earned and final value of a certificate of deposit based on your deposit, APY, term, and compounding frequency.
Last updated: April 7, 2026· Reviewed by the CalcNeeds Team
About This Calculator
A certificate of deposit (CD)is a time-bound savings account offered by banks and credit unions. You deposit a lump sum, agree not to touch it for a fixed term — anywhere from 1 month to 10 years — and in return the bank pays you a fixed interest rate that's usually higher than a regular savings account. Because the rate is locked in at the moment you open the CD, you know exactly how much your money will grow by the time the term ends.
This free CD calculatorshows you the maturity value, total interest earned, and a year-by-year balance breakdown for any deposit, APY, and term length. Choose between daily, monthly, quarterly, or annual compounding to see how each option affects your final return. Whether you're shopping a 6-month CD, a 12-month CD, or a 2-year or 5-year CD, the math below tells you exactly what to expect.
How CD interest is calculated
CDs use compound interest. Each compounding period the bank multiplies your current balance by the periodic rate (the APR divided by the number of periods per year) and adds that interest back to your principal. In the next period, you earn interest on the new, larger balance — that's the "interest on interest" effect that makes CDs grow faster than a simple-interest account.
The standard formula is FV = P × (1 + r/n)^(n × t), where P is your initial deposit, r is the annual rate as a decimal, n is the number of compounding periods per year, and t is the number of years. Subtract P from FV and you have your total interest earned.
APY vs. APR — what banks actually quote
The APY (Annual Percentage Yield)is the figure banks are required by federal Truth in Savings rules to advertise. It already bakes in compounding, so it represents the real return you'll see if the CD compounds over a full year. The APR is the underlying simple rate before compounding is factored in. For the same CD, the APY is always equal to or slightly higher than the APR.
This calculator accepts the APY (the number on the bank's website), derives the equivalent APR for your selected compounding frequency, and uses that to project the year-by-year balance. That way you can compare two CDs apples-to-apples even when the banks compound at different intervals.
Compounding frequency: daily, monthly, quarterly, annually
Most U.S. banks compound CD interest daily or monthly, though some smaller institutions still use quarterly or annual compounding. The more frequent the compounding, the more total interest you earn — but the difference is usually small. On a $10,000 1-year CD at 5% APY, daily compounding earns only a few dollars more than annual compounding because the APY already accounts for the effect.
Where compounding really matters is on multi-year CDs. A 5-year CD at 4.5% can earn $50–$100 more with daily vs. annual compounding on a $25,000 deposit. Use the toggle above to see the exact difference for your numbers.
Common CD term lengths
CDs are typically offered in standard terms: 1, 3, 6, 9, 12, 18, 24, 36, 48, and 60 months, though some banks offer no-penalty, bump-up, or specialty terms in between. Short CDs (3–12 months) tend to pay slightly less than long CDs in a normal rate environment, but during an inverted yield curve — like the one in 2023–2024 — short CDs sometimes pay more than 5-year CDs.
Pulling money out before the term ends triggers an early withdrawal penalty, usually equal to 3–12 months of interest depending on the term length. The calculator above projects the value assuming you hold the CD to maturity.
Types of CDs
Traditional CD— fixed rate, fixed term, single deposit. This is what most people mean by "CD" and what this calculator models.
Add-on CD — lets you make additional deposits during the term. Useful if you want to dollar-cost average into a fixed rate.
Bump-up CD— gives you the option to raise your rate once or twice during the term if the bank's rates go up.
No-penalty CD — lets you withdraw your full balance before maturity without a penalty, in exchange for a slightly lower APY.
Jumbo CD — requires a large minimum deposit (often $100,000+) and may pay a slightly higher rate.
IRA CD — held inside a traditional or Roth IRA so the interest grows tax-deferred or tax-free.
Frequently Asked Questions
How do I calculate CD interest?
Use the formula FV = P × (1 + r/n)^(n × t), where P is your deposit, r is the APR as a decimal, n is the number of compounding periods per year (12 for monthly, 365 for daily), and t is the term in years. Subtract P from FV to get the interest earned. The calculator above does this automatically once you enter your deposit, APY, and term.
Are CDs compounded monthly or daily?
It depends on the bank. Most large U.S. banks compound CD interest daily, while many credit unions and online banks use monthly compounding. The bank is required to disclose the compounding method along with the APY. Daily compounding produces slightly more interest than monthly for the same APR, but because banks quote APY (which already includes compounding), two CDs with the same APY will deliver nearly the same return regardless of frequency.
How do I calculate the maturity value of a CD?
The maturity value is your initial deposit plus all the compound interest accumulated by the end of the term. Plug your deposit, APY, term in months, and compounding frequency into the calculator above and the 'Final Value' is your maturity value. For a $10,000 deposit at 5% APY for 12 months compounded monthly, the maturity value is approximately $10,511.62.
What's the difference between APY and APR on a CD?
APY is the effective annual return after compounding is included. APR is the underlying nominal rate before compounding. For the same CD, APY will always be equal to or higher than APR. Banks are legally required to advertise the APY so consumers can compare offers fairly. Use APY when shopping CDs.
How do I calculate CD yield?
CD yield is the same as APY — it's the percentage of your principal you earn back as interest in one year, including compounding. To calculate it from a known APR, use APY = (1 + APR/n)^n − 1, where n is the number of compounding periods per year. Most of the time you don't need to compute this yourself — banks publish the APY directly.
Can I use this for a 6-month, 12-month, or 2-year CD?
Yes. Enter the term in months — 6 for a 6-month CD, 12 for a 1-year, 24 for a 2-year, 60 for a 5-year, and so on. The calculator handles any term length and produces a year-by-year breakdown including a partial final year if your term isn't a whole number of years.
What is an add-on CD?
An add-on CD lets you deposit additional money during the term, instead of being limited to the single opening deposit like a traditional CD. The new deposits earn the original locked-in rate. Add-on CDs are useful if you want to lock in a high rate now but expect to have more cash to deposit over the next several months. This calculator models a single-deposit traditional CD.
Are CD earnings taxed?
Yes. Interest earned on a regular CD is taxed as ordinary income in the year it's credited to your account, even if you don't withdraw it. Your bank will send a 1099-INT if you earn more than $10. Interest inside an IRA CD is tax-deferred (traditional IRA) or tax-free (Roth IRA) until withdrawal.
Is a CD better than a high-yield savings account?
CDs typically pay a slightly higher rate than high-yield savings accounts in exchange for locking your money up for a fixed term. If you know you won't need the cash before the term ends, a CD usually wins. If you need flexibility — for an emergency fund, for example — a high-yield savings account is the better choice even at a slightly lower rate.
About CalcNeeds— We build free, accurate, and easy-to-use calculators for everyday decisions. Our tools are reviewed for accuracy and updated regularly. Have feedback? Let us know.