Certificate of Deposit Calculator

MonitorBankRates.com has five new financial calculators including a Certificate of Deposit (CD) calculator. The calculators are very easy to use and are located under the “Calculators” tab. A CD calculator will help you determine how much interest you will earn on a CD.

To determine the amount of interest you will be paid on a certificate of deposit, just enter the CD deposit amount, the term of the CD, the CD interest rate and how interest will be compounded, daily, weekly, monthly or annually.

The more frequent interest is compounded the higher the overall return and annual percentage yield will be. To give you a better idea will use this example.

$100,000 deposited in a 12 month CD with an interest rate of 5.00% compounded daily will have an APY of 5.127%. Earning $5,126.74 in interest.

 $100,000 deposited in a 12 month CD with an interest rate of 5.00% compounded annually will only have an APY of 5.00%. Earning $5,000 in interest, $126.74 less then a CD compounded daily.

This is the power of compound interest, earning interest on top of interest. $100,000 deposited in a 5 year CD with the same interest rate above compounded daily will earn $28,400.31, compounded annually will only earn $27,628.13, a difference of $772.18.

So next time you are looking for the best CD rates try MBR’s CD calculator for yourself and see how much interest you will earn before investing in a certificate of deposit.