CD Calculator (Certificate of Deposit)
What a CD is worth at maturity, from its APY.
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Formula
Balance = deposit × (1 + APY)^(months ÷ 12)
US banks advertise a CD by its annual percentage yield, which already folds in however often interest compounds. That makes the arithmetic short: one year grows the deposit by exactly the APY, and any other term raises (1 + APY) to the fraction of a year it lasts.
Worked example
$10,000 in a 12-month CD at 4.5% APY earns $450, for $10,450 at maturity. Left for 24 months at the same yield it would reach about $10,920, because the second year earns interest on the first year's interest.
Where this can give the wrong answer
- Enter the APY, not the interest rate. They differ whenever interest compounds more than once a year; a bank's rate sheet shows both, and the APY is the larger one.
- A six-month CD earns slightly less than half a year's APY, because (1 + APY) is raised to the half power rather than halved.
- Taking money out before the term ends means paying the bank a penalty. The amount is set by each bank, so compare it along with the rate, and it is not modelled here.
- Interest on a CD is taxable income. The figure shown is before tax.
FAQ
- A fixed deposit is quoted as a nominal rate plus a compounding frequency, which is how Indian banks advertise them. A US CD is quoted as an APY with compounding already included, so this page asks for one number instead of two.
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