CD Calculator: Interest Earned, APY and Early Withdrawal Cost

Enter the amount you deposit, the CD's rate and its term in months. If the bank quotes an APY (annual percentage yield), leave "Rate is APY" ticked — APY already includes compounding. If it quotes an interest rate, untick it and pick how often interest compounds. The calculator shows the balance at maturity, the interest earned before and after tax, and an estimate of an early-withdrawal penalty stated in months of interest. It assumes interest stays in the CD until maturity and the rate is fixed for the term.

How CD interest is calculated

Under the Truth in Savings Act (Regulation DD), APY is the interest a deposit earns in a year including compounding. So a CD's balance at maturity is deposit × (1 + APY)^(months ÷ 12). $10,000 in a 12-month CD at 4% APY earns $400, or $312 after a 22% tax rate. When a bank quotes a rate instead, APY = (1 + rate ÷ n)^n − 1 for n compounding periods a year: 5% compounded daily is 5.13% APY and compounded monthly is 5.12% APY. Compare CDs by APY, not by rate.

What CDs pay on average (FDIC, September 2026)

The FDIC publishes a monthly national rate for each CD term: the deposit-weighted average across insured banks and credit unions. The September 2026 table (published September 21, 2026) is below, with the interest on $10,000 at that rate and at 4% APY for comparison. Online banks and credit unions often pay well above the national average, which is why it pays to compare. Rates change; check the bank's current APY before you open a CD.

Early withdrawal penalties

Banks usually state the penalty as a number of months of interest — for example 3 months on a 1-year CD and 6–12 months on longer terms. The penalty must be disclosed before you open the account (Regulation DD), and it can be larger than the interest earned so far, which means you can get back less than you deposited. On the example CD, 3 months of interest is about $98.53. Check the account disclosure for the exact formula; some banks charge on the amount withdrawn and others on the whole balance.

How this CD calculator works, in plain language

A CD pays a fixed rate for a fixed term. Each time interest is credited it is added to the balance, so later interest is paid on a slightly bigger amount — that is compounding. The APY already rolls the compounding into one yearly figure, so the calculator grows your deposit by the APY for each year of the term (or by the matching fraction of a year for terms like 6 or 18 months). It then takes your tax rate off the interest and estimates the early-withdrawal penalty as the number of months of interest your bank charges. It does not know your bank's exact day count or crediting dates, so expect the bank's figure to differ by a few cents to a few dollars.

CD interest by scenario

Six realistic deposits, computed with the same formula as the calculator. Two rows use the FDIC's September 2026 national averages (published September 21, 2026); the others use example APYs for comparison, not quotes from any bank. Tax is at a 22% rate on the interest. The penalty column is what breaking the CD would cost under a typical months-of-interest penalty; check your own disclosure.

Daily vs monthly compounding, and a simple CD ladder

When a bank quotes a rate rather than an APY, compounding frequency matters a little: $10,000 at a 4% rate for a year earns $408.08 compounded daily, $407.42 monthly and $406.04 quarterly. Once you compare by APY the frequency is already counted. A ladder splits money across terms so part of it matures every year: $30,000 split evenly into 1-, 2- and 3-year CDs at example APYs of 4.00%, 3.85%, 3.75% earns $400, $784.82 and $1,167.71 respectively, $2,352.54 in all, if each is held to maturity. Run each rung through the calculator separately.

Common CD calculator mistakes

Where CD estimates most often go wrong, and how to avoid each one.

• Comparing interest rates instead of APYs. Two CDs with the same rate but different compounding pay different amounts; the APY puts them on the same footing.
• Treating the penalty as a cost to interest only. Break the $25,000 18-month CD above after 4 months and it has earned about $337.10, but 6 months of interest is about $507.35 — the difference comes out of your deposit.
• Forgetting tax on interest you haven't withdrawn. The IRS counts CD interest as taxable interest (Topic 403), and the bank sends a Form 1099-INT when it pays you $10 or more in a year.
• Assuming the rate carries on after maturity. Many CDs renew automatically at whatever rate the bank offers then; check the maturity notice before the grace period ends.
• Going over the insurance limit. FDIC deposit insurance covers at least $250,000 at each insured bank, and the limit applies per depositor and ownership category, so very large deposits may need more than one bank.
• Using a 12-month rate for a 5-year CD. Longer CDs don't always pay more: in the FDIC's September 2026 table the 12-month average (1.73%) is above the 60-month average (1.38%).

Taxes and insurance

CD interest is taxable as ordinary income for the year it is credited to the account, even if you don't withdraw it, and the bank reports it on Form 1099-INT (IRS Topic 403). CDs at FDIC-insured banks are covered up to $250,000 per depositor, per insured bank, for each account ownership category; credit union share certificates have the same coverage through the NCUA. Brokered CDs bought through a brokerage can trade below face value if you sell before maturity.

• High-yield savings calculator
• Simple interest calculator
• Emergency fund calculator
• Future value calculator