Updated 20 May 2026
CD Interest Calculator: How Much Will Your CD Earn?
Calculate exactly how much interest you will earn on any CD. Adjust deposit amount, APY, term, and compounding frequency. Compare side-by-side to a high-yield savings account.
CD at 4.40% for 12 months
Interest earned
$1,124
Final balance
$26,124
HYSA at 4.25% (same period)
Interest earned
$1,085
CD advantage
+$39
Pre-Calculated Examples at Current Rates
$10K at 4.30% for 6 months
$215
interest earned
$10K at 4.20% for 1 year
$420
interest earned
$25K at 4.20% for 1 year
$1,050
interest earned
$25K at 3.90% for 2 years
$1,950
interest earned
$50K at 4.20% for 1 year
$2,100
interest earned
$100K at 3.60% for 5 years
$18,000
interest earned
Does Compounding Frequency Matter?
Short answer: barely. Here is $25,000 at 3.80% for 1 year with different compounding frequencies:
| Compounding | Interest (1 year) | Interest (5 years) | Difference from Daily |
|---|---|---|---|
| Daily | $1,020 | $5,535 | - |
| Monthly | $1,019 | $5,525 | -$10 |
| Quarterly | $1,015 | $5,505 | -$30 |
| Annually | $1,000 | $5,416 | -$118 |
The difference between daily and annual compounding on $25K at 3.80% over 5 years is about $118. The APY rate matters far more than how often interest compounds.
APY vs APR: What Is the Difference?
APY (Annual Percentage Yield) includes the effect of compounding. This is how CD rates are quoted. When a bank says "4.20% APY," that means you earn exactly 4.20% per year on your deposit, including compound interest.
APR (Annual Percentage Rate) does not include compounding. It is more commonly used for loans and credit cards. A 3.80% APR with daily compounding produces an effective APY of about 4.08%.
For CD comparisons: Always compare APY to APY. If one bank quotes APR and another quotes APY, they are not directly comparable. Almost all US banks quote CD rates as APY, so this is rarely an issue in practice.
Frequently Asked Questions
How is CD interest calculated?▾
CD interest is typically compounded daily and credited monthly. The formula is: Final Balance = Principal x (1 + APY/n)^(n x years), where n is the compounding frequency (365 for daily). Most banks quote APY (annual percentage yield) which already accounts for compounding, making comparison straightforward.
What is the difference between APY and APR?▾
APY (annual percentage yield) includes the effect of compounding. APR (annual percentage rate) does not. For CDs, rates are quoted as APY. A 3.80% APY means you actually earn 3.80% per year including compounding. A 3.80% APR with daily compounding produces a slightly higher effective yield of about 4.08%. Always compare APY to APY.
Does compounding frequency matter for CDs?▾
Very little for short terms. On $25,000 at 3.80% for 1 year, the difference between daily and annual compounding is about $3. Over 5 years it grows to about $20. For practical purposes, the APY rate matters far more than the compounding frequency.