CD Calculator
What a certificate of deposit is worth at maturity — and what it is worth if you need the money before then.
The address carries whatever you changed, so anyone opening it sees these numbers. Nothing is saved on our side.
Value at maturity
$10,459
$10,000 at 4.5% for 1 year earns $459 — an APY of 4.594%. Breaking it at month 6 costs $345.
- $10,000
- $459
- 4.594%
- $10,227
- before the penalty
- $112.50
- 3 months of interest
- $10,115
What each term earns
Held to maturity, at the rate you entered. In practice a bank quotes a different rate for each term, so replace the rate when comparing a specific offer.
| Term | Interest earned | Value at maturity | vs yours |
|---|---|---|---|
| 6 monthsAPY 4.594% | $227 | −$232 more in total | |
| 1 yearyoursAPY 4.594% | $459 | — | |
| 1 year 6 monthsAPY 4.594% | $697 | +$238 less in total | |
| 2 yearsAPY 4.594% | $940 | +$481 less in total | |
| 3 yearsAPY 4.594% | $1,442 | +$983 less in total | |
| 5 yearsAPY 4.594% | $2,518 | +$2,059 less in total |
The longer rows earn more only because the money is committed longer, not because the rate improves — the rate is held constant here so the effect of time is visible on its own. Whether a longer term is actually better turns on the rate the bank offers for it and on what rates do while your money is locked up, which is a judgment rather than a calculation.
How this calculator works
Straightforward compounding, plus the one part of a CD that has a sharp edge.
The deposit compounds at the stated nominal rate at your chosen frequency: A = P (1 + r/n)^(n·t). The APY reported alongside is (1 + r/n)ⁿ − 1, which is the figure your bank is required to advertise.
The early-withdrawal penalty is modelled the way disclosures express it: a number of months of interest, computed on the deposit at the stated rate — not on the balance you have accrued, and not on the interest actually earned. That is the whole reason a penalty can exceed your earnings.
When the net amount after the penalty falls below the original deposit, the calculator says so explicitly. It is the single most surprising thing about the product and it should not be something you have to notice for yourself.
What is assumed
- A fixed rate held to the stated term.
- Interest left in the CD rather than paid out monthly.
- A penalty expressed as months of interest, as most are.
- No tax, and no automatic renewal at whatever rate applies later.
A worked example
$10,000 at 4.5% for twelve months, with a three-month early-withdrawal penalty.
| Monthly rate | 4.5% ÷ 12 |
|---|---|
| Value at maturity | $10,000 × 1.00375¹² |
| APY | (1 + 0.045/12)¹² − 1 |
| Value at month six | $10,000 × 1.00375⁶ |
| Penalty | ($10,000 × 4.5% ÷ 12) × 3 |
| You would receive | 10,227.12 − 112.50 |
| Cost of breaking it at month six | 10,459.40 − 10,114.62 |
At month six you still come out ahead of your deposit — $114.62 of the $227.12 earned survives the penalty. Break the same CD at month one, though, and the arithmetic reverses: $37.50 earned against a $112.50 penalty returns $9,925.00, which is $75 less than you put in.
The practical rule that falls out of this is worth stating: with a penalty of N months of interest, a CD is loss-making to break for roughly its first N months, and only starts genuinely paying after that. Match the term to money you are confident you will not need, and keep the rest somewhere you can reach.
Questions people ask
The deposit compounds at the stated rate for the term: A = P (1 + r/n)^(n·t). $10,000 at 4.5% compounded monthly for a year matures at $10,459.40, an APY of 4.594%. Note that banks usually advertise the APY rather than the nominal rate, so if the figure you were given is an APY, the nominal rate behind it is slightly lower — the APY Calculator converts between them.
It is normally quoted as a number of months of interest — three months on a one-year CD, six or more on longer terms — and it is calculated on the deposit at the stated rate rather than on the interest you have actually earned. That distinction is why breaking a CD in its first months can return less than you put in: there is simply less interest accrued than the penalty demands.
Yes, and it is not a sign of a bad bank. Federal regulations require a minimum early-withdrawal penalty on time deposits, so an institution cannot waive it to nothing. If the penalty exceeds the interest earned so far, the difference comes out of the deposit. The calculator flags this case explicitly rather than leaving you to notice it.
CDs at FDIC-insured banks and NCUA-insured credit unions are covered within the standard insurance limits per depositor, per institution, per ownership category. Brokered CDs are a different product with their own considerations, including a secondary market where selling before maturity means taking a market price rather than paying a fixed penalty. Check your institution's coverage rather than assuming it.
It depends on something no calculator can tell you: what rates do while your money is locked up. A longer term protects you if rates fall and costs you if they rise. The arithmetic above holds the rate constant across terms so you can see the effect of time alone; the actual rates offered for each term are the input that decides it, and they should come from the bank rather than from here.
Splitting the money across several terms — say a fifth into each of one to five years — so that one CD matures every year and can be reinvested or spent. It gives you most of the rate advantage of longer terms while keeping some money reachable annually without penalty. Run each rung through this calculator separately, since each has its own rate and term.
Related calculators
Terms, rates and early-withdrawal penalties vary by institution and product; use the figures from your own disclosure. Interest is generally taxable in the year it is credited, which is not modelled here.