CD Return Calculator
A certificate of deposit pays a fixed rate for a fixed term in exchange for leaving your money untouched. The growth depends on whether interest compounds and on how early withdrawal penalties would bite, but the core number is simply the deposit grown at the APY.
Value at maturity
$11,411.66
- Interest earned
- $1,411.66
- Average interest per year
- $470.55
Values update as you type. This calculator covers the single scenario its formula assumes — see Common Mistakes for what it leaves out.
The formula this calculator uses
A = P(1 + r)^t
- P
- Amount deposited
- r
- Annual percentage yield as a decimal
- t
- Term in years
- A
- Value at maturity
How to check the result by hand
- 1
Use the APY, not the nominal rate
The APY already folds in compounding, so it is the only rate you need. If a bank quotes only a nominal rate, convert it to the APY first, otherwise the maturity value you compute will be too low.
- 2
Convert the APY to a decimal
A 4.5% yield becomes 0.045 for the formula. Leaving it as 4.5 multiplies the deposit by a number near four and a half and produces a nonsense balance several times too large.
- 3
Raise one plus the yield to the term
For a three-year CD compute 1.045 raised to the third power, which is 1.141166. Each year's growth compounds onto the previous year's balance, which is exactly what a CD does.
- 4
Multiply by the deposit
10,000 times 1.141166 gives 11,411.66 at maturity. This single multiplication captures the entire term's growth because the exponent already handled the compounding.
- 5
Subtract the deposit for interest
11,411.66 minus 10,000 leaves 1,411.66 of interest earned over the three years, which is the figure to compare against other cash products on the same term.
For worked examples, common mistakes and the limits of this formula, read the full How To Calculate CD Return page.