A certificate of deposit (CD) is a fixed-term savings product that pays a set rate in return for locking your money in. It grows by compound interest: maturity value = principal × (1 + rate/n)^(n × years). This calculator gives the maturity value, interest earned and effective APY for any deposit, rate, compounding frequency and term — so you can compare offers on the number that matters, the APY.
Reviewed: June 20, 2026 · Author: Naveen P N, Founder — AI Calculator · Verified against: the compound-interest formula, recomputed in code. Estimates before tax; not financial advice.
The CD formula
The deposit P earns interest that is added back n times a year, so it compounds. The more often it compounds, the slightly higher the effective yield: that's what the APY captures, turning a nominal rate into the true annual return. Comparing CDs by APY is fairer than by the headline rate, because two CDs with the same rate but different compounding earn different amounts.
Worked example — $10,000 at 5%
Scenario: $10,000, 5% annual rate, compounded monthly, 3-year term.
The CD matures at $11,614.72, earning $1,614.72 over three years at an effective 5.116% APY. Compounding daily instead would nudge the APY to about 5.13%; annually drops it to exactly 5.00%. A shorter $5,000 CD at 4.5% compounded daily for two years reaches about $5,470.84 — the same formula, different inputs.
Frequently Asked Questions
FV = P × (1 + rate/n)^(n×years). $10,000 at 5% monthly for 3 yr → $11,614.72, earning $1,614.72.
The effective yearly yield: (1 + rate/n)ⁿ − 1. 5% monthly ≈ 5.116% APY. Compare CDs by APY.
A little — daily yields slightly more than annually for the same rate. 5%: ~5.13% daily vs 5.00% annual.
Usually a penalty (often months of interest). Only deposit money you can leave until maturity.
Generally yes, as income in the year credited. These figures are before tax.