Purpose: Certificates of deposit (CDs) can offer better yields – thanks to higher interest rates – than most savings accounts. This calculator will let you see how your savings could grow over time if you placed it in a CD. Use it to compare interest rates among different CDs and banks as well as to see how a term would affect your overall yield.
Tips & Insight: Unlike a regular savings account, when you deposit money in a CD you’re agreeing to leave it there for a set period of time. Withdraw early and you’ll end up paying a penalty, so be sure you’re only depositing an amount you can afford to set aside for the full term. You also lock in to an interest rate. While longer terms often offer higher rates, if you anticipate that rates will rise, you might want to lock in to a shorter term now and then reinvest that amount once the CD matures and rates are higher.