CD calculator: How much interest will you earn?

If you have a particular goal in mind that you’re trying to reach, a CD calculator can help you determine how much you need to deposit and for how long the terms should be to reach that goal. Since the rates are fixed, and not subject to change while your money is locked up, it’s easy to determine how much interest you’ll earn by using a calculator.

CD calculator

How do I use the CD calculator?

Fill in the relevant fields with the correct information to get the details you need to help you decide which certificate of deposit to choose.

• Deposit amount. This is the amount of money you plan to save in the CD.
• Interest rate. Input the listed interest rate for the certificate of deposit you’re investigating. Pay attention to the details, as in most cases that amount will be different depending on a number of factors, including the length of the term, how much you deposit and how often you’re receiving interest payments.
• Length of time. This is the number of years you’ll be saving for. You can enter a fraction of a year if your CD term is something like 6 months or 18 months.

Use current CD rates to calculate interest

Sort by:

Name	Product	1-year APY	18-month APY	2-year APY	3-year APY	5-year APY
CIT Bank Term CDs		0.3%	0.3%	0.4%	0.4%	0.5%	Go to site More Info	Compare	loading Fetching your data...
Radius Bank CDs		0.5%	0.5%	0.5%	0.5%	0.5%	Go to site More Info	Compare	loading Fetching your data...
BBVA CD		0.1%	0.1%		0.1%		Go to site More Info	Compare	loading Fetching your data...
Discover CDs		0.6%	0.6%	0.6%	0.65%	0.7%	Go to site More Info	Compare	loading Fetching your data...
Discover IRA CDs		0.6%	0.6%	0.6%	0.65%	0.7%	Go to site More Info	Compare	loading Fetching your data...
Barclays Online CDs		0.3%	0.3%	0.3%	0.3%	0.3%	More Info	Compare	loading Fetching your data...
Ally High Yield CDs		0.65%	0.7%		0.75%	1%	More Info	Compare	loading Fetching your data...

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How to calculate your CD’s interest

If you’d rather calculate your CD’s interest by hand, follow the steps below to find the information for this equation:

\[A = P(1 + {r\over n})^{nt}\]

• P is the principal balance, so enter your deposit amount.
• r is your CD’s interest rate written as a decimal, so take your APY and move the decimal to the left two times. For example, if your APY is 2%, r is 0.02.
• n is the number of times your CD will compound each year. Enter 365 if your CD compounds daily, 12 if it compounds monthly, 4 if it compounds quarterly or 1 if it compounds yearly.
• t is the length of your CD term in years. If your CD term is less than a year, divide 365 by the length of your term, in days, to get your CD term in years. For example, if your CD has a 90-day term, t is 0.25 years (90/365).
• A is how much your CD will be worth at maturity, including your deposit. This is the number we’ll be solving for.

What factors influence CD interest rates?

There are several things banks consider when calculating CD interest rates, including the following:

• The federal funds rate. Set by the Federal Reserve, the federal funds rate influences a range of other interest rates in the economy, including mortgages and CDs. It refers to the interest rate banks charge each other on overnight loans, and is a benchmark rate they use when setting interest rates on CDs and savings accounts.
• The amount you invest. The larger the amount you want to invest, the higher the interest rates available. For example, a bank may offer one set of interest rates for amounts less than $10,000 and a set of higher rates for deposits above $10,000. For large investment sums, such as $250,000 or more, you may be able to negotiate a special rate.
• The investment term. The longer the term you select, the higher the interest rate you’ll receive — your bank wants to encourage you to invest your money for longer as this provides it with a guaranteed source of funding for an extended period.
• The deposit market. Your bank may want to gain a larger slice of the CD market share by enticing new customers with attractive interest rates that beat many of its competitors.
• Your bank’s financial position. For example, if a bank wants to decrease its reliance on funding from overseas sources, it can raise its interest rates on multi-year CDs to provide a secure, long-term source of funding from within the US.

Bottom line

A certificate of deposit can help you grow your savings in a low-risk and predictable way. The longer your term length, the more money you’ll earn — especially if you get a CD with a top-of-the-market interest rate.

Frequently asked questions

• Will the amount shown on the calculator be exactly the same as the amount of interest I earn?

  CDs earn interest at a predictable rate, so it should be accurate. However, there may be other factors not taken into consideration that could affect the amount of interest paid to you, such as ongoing fees associated with the CD you pick.

• The term I chose is for 30 months. How should I enter that?

  The calculator recognizes terms in years, not months. For example, in this case you would choose a 2.5-year term for 30 months.

• I want to make at least $500 in interest; how would I figure that out?

  You would have to play with the numbers that you insert into the field, particularly the length of terms as this is the option you have the most control over, until you come out with the earnings you want.

• How is a CD's interest calculated?

  A certificate of deposit, or CD, is a type of high-interest savings account that is closed for withdrawals or deposits for the length of time that you choose. Interest is calculated at a fixed rate, and any payments made while the term is in place are made to a separate account, allowing you to know precisely how much you earn.

• Can I use this calculator for a regular savings account?

  No, a high-interest savings account may have additional considerations. To get the most accurate prediction for interest earned on your savings account, use a savings account calculator.