# CD Calculator – Certificate of Deposit

URL: https://speedycalculator.com/calculators/finance/cd/
Last updated: 2026-10-25

> The CD calculator works out how much a certificate of deposit will be worth at maturity, the interest earned and the APY, from the deposit, interest rate, term and compounding frequency – and the effect of tax on the interest.

## Inputs

- Initial deposit
- Interest rate (APR) (%)
- Term (years, months)
- Compounding frequency
- Tax rate on interest (%)

## Results

- Final balance
- Interest earned
- APY
- Interest after tax

## Formula

```
Final balance = deposit × (1 + r ÷ n)^(n × years)
APY = (1 + r ÷ n)^n − 1
After-tax interest = interest × (1 − tax rate)
```

## Explanation

CDs pay a fixed rate for a fixed term – from a few months to five years or more. Banks usually compound daily or monthly. Withdrawing early normally costs a penalty of several months' interest. CDs at FDIC-insured banks are protected up to $250,000 per depositor, per bank.

### How to use the CD Calculator – Certificate of Deposit

- **Initial deposit**
- **Interest rate (APR)**
- **Term**
- **Compounding frequency**
- **Tax rate on interest**

Results update as you type, and every field accepts the units shown in its menu.

### How it works

Enter the deposit, the interest rate (not the APY), the term and the compounding frequency, and optionally your tax rate.

### Tips

- Use the nominal annual rate and pick the compounding frequency your bank or broker states.
- Small differences in return or fees compound into large differences over decades.
- Run the calculation with a cautious, a central and an optimistic return to see the range of outcomes.
- Past returns do not guarantee future returns – nothing here is investment advice.

### Common mistakes to avoid

- Comparing an APR with an APY or effective rate.
- Ignoring inflation, taxes and fees when judging a real return.
- Entering a percentage as a decimal (5 instead of 0.05 is correct here).

### Inputs explained

FieldWhat to enterInitial depositAmount in your currencyInterest rate (APR)In %TermUnits: years, monthsCompounding frequencyChoose one: Yearly, Semi-annually, Quarterly, Monthly …Tax rate on interestIn %

### What each result means

- **Final balance** = [Initial deposit]×(1 + effr([Interest rate (APR)]÷100, [Compounding frequency]))^([Term]÷12)
- **Interest earned** = [Final balance] - [Initial deposit]
- **APY** = effr([Interest rate (APR)]÷100, [Compounding frequency])×100
- **Interest after tax** = [Interest earned]×(1 - [Tax rate on interest]÷100)

### Example values

How the main result changes when **Initial deposit** changes and everything else stays at the example values above:

Initial depositFinal balance5,0005,442.777,5008,164.1510,00010,885.5412,50013,606.9215,00016,328.320,00021,771.07

## Worked example

Inputs — Initial deposit: $10,000; Interest rate (APR): 4.25 %; Term: 2 years; Compounding frequency: Monthly; Tax rate on interest: 0 %.

Results — **Final balance = $10,885.54**; Interest earned = $885.54; APY = 4.334 %; Interest after tax = $885.54.

## FAQ

**How is CD interest calculated?**
With compound interest: deposit × (1 + rate ÷ n)^(n × years).

**Are CDs insured?**
Yes, at FDIC (banks) or NCUA (credit unions) institutions up to $250,000 per depositor per institution.

**What happens if I withdraw early?**
You usually pay a penalty, often 3–12 months of interest.

**What formula does the CD Calculator – Certificate of Deposit use?**
Final balance = deposit × (1 + r ÷ n)^(n × years).


## Sources

- [FDIC – Deposit insurance](https://www.fdic.gov/resources/deposit-insurance)