Build live 2026 estimates with USA, UK, metric, and imperial options for cd calculator.
A CD (Certificate of Deposit) calculator shows exactly how much your lump sum will grow in a fixed-term deposit, based on your APY, compounding frequency, and term. In the US it's called a CD; in the UK it's a Fixed-Rate Bond or Fixed-Rate Savings Account. The maths is identical.
Final Balance = Principal × (1 + APY/n)n × years
Where APY is the advertised annual yield, n is compounding periods per year, and years is your term. Most US CDs compound daily or monthly; most UK fixed bonds credit interest annually or at maturity.
US CD rates as of 2026 range from roughly 4.5–5.3% APY for 6-12 month terms, with longer terms sometimes lower (inverted curve). CDs at FDIC-insured banks or NCUA-insured credit unions are protected up to $250,000 per depositor, per bank, per ownership category. Early withdrawal penalties typically range from 3 months' interest (short CDs) to 12 months' interest (5-year CDs).
UK fixed-rate bonds currently pay around 4.2–4.8% AER for 1-3 year terms. Deposits are protected by the FSCS up to £85,000 per person, per banking licence (not per bank brand — many UK banks share a licence). UK fixed bonds usually don't allow early withdrawal at all; check the T&Cs before locking funds away.
Banks are legally required to advertise APY/AER on US CDs and UK bonds, so comparing by APY/AER gives apples-to-apples.
Instead of a single 5-year CD, a CD ladder splits your money across 1-, 2-, 3-, 4-, and 5-year CDs. Every year one matures and gets reinvested into a new 5-year, giving you both liquidity and (on average) the long-term rate. Useful when rates are high but uncertain.
Yes — FDIC (US) up to $250k and FSCS (UK) up to £85k mean your principal and interest are effectively risk-free up to those limits. Beyond the limit, split deposits across different banks/licences.
Only if the new CD's rate, after the early withdrawal penalty, still beats keeping the current CD. Calculate: (new rate × remaining years) − penalty − (old rate × remaining years). If positive, switch.
In the US, CD interest is ordinary income reported on Form 1099-INT. In the UK, interest above your Personal Savings Allowance (£1,000 basic rate / £500 higher rate) is taxed at your marginal rate. Cash ISAs are tax-free.
Marginally. Daily vs monthly compounding on a 5% 3-year CD differs by about 0.03 percentage points — focus on the APY/AER, not how often it compounds.
Most traditional CDs don't allow additional deposits — you'd open a new CD. Add-on CDs exist at some credit unions and online banks but typically pay a slightly lower rate in exchange for flexibility.
This tool provides savings estimates for informational purposes only and is not financial, tax, or legal advice. Actual returns depend on the bank or provider, compounding method, penalties, fees, and tax treatment. Review real terms before opening or closing a deposit product.
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A Certificate of Deposit (CD) is a type of savings account offered by banks and credit unions in the United States that holds a fixed amount of money for a fixed period of time (the term) at a fixed interest rate. In exchange for committing your money for the full term – which can range from 3 months to 5 years – you receive a higher interest rate than a standard savings account or money market account. CDs are one of the safest investments available, backed by FDIC insurance up to $250,000 per depositor per institution per account category.
The UK equivalent of a CD is a fixed-rate savings bond or fixed-rate cash ISA. These work identically: you lock your money for a fixed period (1, 2, 3, or 5 years typically) in exchange for a guaranteed, fixed interest rate that is higher than easy-access savings accounts. UK fixed-rate savings are protected by the Financial Services Compensation Scheme (FSCS) up to £85,000 per person per institution.
Understanding the difference between these three terms is essential for accurately comparing CD offers:
Interest Rate (Nominal Rate): The stated annual interest rate before compounding effects are considered. A CD with a 5% nominal rate compounded monthly does not simply pay 5% per year.
APR (Annual Percentage Rate): In the context of savings products, APR is generally used to describe the nominal interest rate. For loans and credit, APR includes fees; for savings, it typically refers to the simple interest rate before compounding.
APY (Annual Percentage Yield): This is the effective annual rate that accounts for compounding. APY is always greater than or equal to the nominal rate (equal only when compounding is annual). For a 5% rate compounded monthly: APY = (1 + 0.05/12)^12 − 1 = 5.116%. APY is the most useful figure for comparing different CDs because it accounts for how frequently interest is compounded. US law (Truth in Savings Act) requires depository institutions to disclose APY.
In the UK, the equivalent disclosure standard uses AER (Annual Equivalent Rate), which is the same concept as APY – it reflects the rate if interest were paid and compounded annually.
| CD Term | Best For | Considerations |
|---|---|---|
| 3–6 months | Emergency fund tier, near-term expenses | Lower rate; maximum flexibility |
| 1 year | Short-term savings goals; rate-uncertainty hedge | Often highest rates in inverted yield curve environments |
| 2–3 years | Medium-term savings; car purchase, home deposit | Balance of rate and flexibility |
| 4–5 years | Long-term savings; locking in high rates | Higher penalty for early withdrawal; rate may be lower than 1-year in inverted curve |
The main drawback of CDs is the penalty for withdrawing funds before maturity. US CD penalties are set by each institution and typically range from:
If you withdraw very early (before enough interest has accrued), the penalty may reduce your principal. For example, withdrawing after 2 months from a 1-year CD with a 3-month interest penalty means you lose more interest than you've earned, leaving you with slightly less than your original deposit. UK fixed-rate savings bonds typically do not allow early access at all, making them less flexible than US CDs. Some UK providers offer "limited access" fixed-rate bonds with restricted withdrawal windows.
In 2024, following the Federal Reserve's rate hiking cycle, CD rates reached their highest levels in over 15 years. Top 1-year CD APY rates at online banks and credit unions reached 5.0-5.3%, while the national average (weighted across all institutions including legacy banks) remained much lower at approximately 0.23% (FDIC data). This enormous spread between top-of-market and average rates underscores the importance of shopping around. Online banks (Ally, Marcus, Discover, CIT Bank) and credit unions consistently offer rates 10-20x higher than the major traditional banks (Chase, Bank of America, Wells Fargo) for equivalent products.
| Term | National Average APY (FDIC) | Top Rate Available (2024) |
|---|---|---|
| 3 months | ~1.5% | ~5.0% APY |
| 6 months | ~1.7% | ~5.25% APY |
| 1 year | ~1.8% | ~5.30% APY |
| 2 years | ~1.5% | ~4.80% APY |
| 5 years | ~1.3% | ~4.50% APY |
In the UK, Moneysavings Expert and best-buy tables track the top rates from challenger banks and building societies. Following the Bank of England rate rises to 5.25% (peak in 2023-2024), 1-year fixed-rate savings bonds were offering 5.0-5.25% AER from providers like Atom Bank, Charter Savings Bank, Cynergy Bank, and Investec. Five-year fixed rates were typically lower (around 4.0-4.5% AER) reflecting market expectations of future rate cuts. The UK savings market benefits from competition among over 100 providers, and top rates are almost always from challenger banks rather than high street banks (Lloyds, Barclays, HSBC, NatWest typically offer significantly below-market rates).
UK residents can hold fixed-rate savings inside a Cash ISA to shelter interest from income tax. The ISA allowance is £20,000 per tax year (2024/25). With the Personal Savings Allowance reducing or eliminated for additional-rate taxpayers (0% PSA above £125,140 income), the ISA wrapper becomes increasingly valuable at higher income levels.
US deposits are insured by the Federal Deposit Insurance Corporation (FDIC) up to $250,000 per depositor, per insured bank, per account ownership category. Account categories include individual accounts, joint accounts, IRAs, and certain retirement accounts – each insured separately up to $250,000. A married couple could protect up to $1,000,000 at a single FDIC-insured institution by using individual and joint accounts correctly. CDs at FDIC-insured institutions are fully covered up to these limits.
UK deposits are protected by the Financial Services Compensation Scheme (FSCS) up to £85,000 per person per authorised institution. Joint accounts are protected up to £170,000. Temporary higher protection of up to £1,000,000 applies for 6 months following certain life events (home purchase, redundancy payment, inheritance). Note that some UK banking brands share the same banking licence – for example, Halifax and Bank of Scotland are both part of Lloyds Banking Group and share a single £85,000 FSCS limit.
A CD ladder is a strategy for maximising both yield and liquidity by spreading deposits across multiple CDs with different maturity dates. For example, instead of putting $20,000 into a single 5-year CD, you put $4,000 into 1-year, 2-year, 3-year, 4-year, and 5-year CDs. Each year, a CD matures and you reinvest at the prevailing 5-year rate (or access the funds if needed). This strategy ensures you always have money becoming available each year while still capturing higher long-term rates on most of your money. CD laddering is particularly effective in rising rate environments.
In the current US rate environment (2024), the difference between top CD rates and top high-yield savings account (HYSA) rates is relatively small. HYSAs offer full flexibility (no lockup), while CDs offer slightly higher rates in exchange for commitment. If rates are expected to fall, locking in a 5.25% 1-year CD is advantageous. If rates are expected to rise, a HYSA's floating rate may prove better. Money market accounts (MMAs) are similar to HYSAs but may offer limited check-writing ability and debit card access. All three (CD, HYSA, MMA) are FDIC-insured when held at qualifying institutions.
A Certificate of Deposit (CD) is a savings product offered by US banks and credit unions where you deposit a fixed amount for a fixed term (3 months to 5 years) at a guaranteed fixed interest rate. In exchange for locking up your money, you receive a higher rate than a regular savings account. At maturity, you receive your principal plus interest. Early withdrawal incurs a penalty, typically 3-12 months' interest depending on the CD term. CDs at FDIC-insured institutions are protected up to $250,000 per depositor per institution.
The UK equivalent of a CD is a fixed-rate savings bond or fixed-rate cash ISA. These products lock your money for 1-5 years at a fixed AER (Annual Equivalent Rate). UK fixed-rate savings are protected by the FSCS up to £85,000 per person per institution. Top rates in 2024 were 5.0-5.25% AER for 1-year terms, primarily from challenger banks such as Atom Bank, Charter Savings Bank, and Cynergy Bank, rather than high street banks.
APY (Annual Percentage Yield) is the effective annual rate that accounts for compounding. The stated interest rate (nominal rate) does not include the effect of compound interest. For a 5% rate compounded monthly: APY = (1 + 0.05/12)^12 − 1 = 5.116%. APY is always greater than or equal to the nominal rate. US law requires banks to disclose APY on savings products (Truth in Savings Act). The UK equivalent is AER (Annual Equivalent Rate), which is the same concept.
Early withdrawal from a US CD triggers a penalty, typically 3 months' interest for short-term CDs and up to 12 months' interest for 5-year CDs. If you withdraw before earning enough interest to cover the penalty, you may receive less than your original deposit. UK fixed-rate bonds generally do not allow early access at all – the money is locked until maturity. Always read the terms before committing, and ensure you have adequate emergency savings elsewhere before locking money in a CD or fixed-rate bond.
A CD ladder spreads deposits across multiple CDs with staggered maturities (e.g., 1, 2, 3, 4, and 5 years in equal portions). Each year, one CD matures providing liquidity and reinvestment opportunity. This balances the higher yield of longer-term CDs with the flexibility of regular access. Laddering is most beneficial when rates are uncertain or expected to change. It reduces reinvestment risk compared to putting all money in a single long-term CD and avoids tying up all savings at once.
Yes. CDs held at FDIC-insured banks are covered up to $250,000 per depositor, per insured institution, per account ownership category. Individual accounts, joint accounts, IRA accounts, and other categories are each insured separately. A married couple can protect up to $1,000,000 at one bank by using individual and joint accounts. Credit union CDs are insured by the NCUA (National Credit Union Administration) up to the same $250,000 limit. Always verify FDIC or NCUA membership before depositing.
In 2024, top 1-year CD rates of 5.0-5.3% APY meaningfully exceeded US CPI inflation (running at approximately 3-4% in early-mid 2024), offering positive real returns for the first time in several years. This contrasted sharply with 2020-2022 when CD rates of 0.1-0.5% were far below inflation of 4-8%, destroying real purchasing power. The current high-rate environment represents an opportunity for savers to lock in real positive returns that may not persist if the Fed cuts rates further.
A jumbo CD in the US typically requires a minimum deposit of $100,000, compared to the $500-$1,000 minimum for standard CDs. Historically, jumbo CDs offered higher rates than standard CDs to attract large deposits. However, in the modern low-spread environment, the rate difference between jumbo and standard CDs at most institutions is minimal – sometimes zero. Online banks often pay better rates on standard CDs than traditional banks offer on jumbo CDs. Before placing $100,000+ in a single CD, ensure the full amount is within FDIC insurance limits or spread across institutions.