CD & Fixed Deposit Calculator
Interest and balance at maturity for a CD, fixed or term deposit at any compounding, APY from the nominal rate (or the reverse), tax and inflation, early-withdrawal penalty, other terms and a ladder plan — any currency.
| Balance at maturity | — |
|---|---|
| APY / effective annual rate | — |
| Interest per month (average) | — |
| After tax | — |
| Real return after inflation | — |
| Early withdrawal | — |
| Same deposit at other terms | — |
| Ladder idea | — |
In short
A CD or fixed deposit grows by deposit × (1 + nominal rate ÷ compounding periods)^(periods × years); APY = (1 + nominal ÷ periods)^periods − 1. 25,000 at 4.5% nominal compounded monthly (4.594% APY) earns about 1,742 over 18 months; an early-withdrawal penalty of 3 months' interest (281) applies if cashed in early, and tax and inflation reduce the real return.
Who this is for: Savers comparing CDs, fixed deposits and term deposits across rates, compounding and terms.
CDs, fixed deposits and term deposits
- Compounding: balance = deposit × (1 + nominal ÷ periods)^(periods × years). Monthly vs daily compounding changes a 4.5% deposit by only a few units a year — the rate matters far more than the frequency.
- APY / AER is the effective annual rate after compounding; a 4.4% nominal compounded monthly is 4.49% APY. Many banks quote APY, others nominal — pick the right option.
- Simple interest applies when interest is paid out (to a linked account) rather than added to the deposit — common for monthly-income deposits in Pakistan and the Gulf.
- Early withdrawal usually forfeits a fixed number of months' interest; on a young deposit that can exceed the interest earned and eat into the principal.
- Laddering splits the money across staggered maturities so some is always close to available while most earns the longer-term rate.
- Islamic alternatives (mudarabah / wakala deposits) pay an expected profit rate instead of interest; the arithmetic is the same.
See also: Compound Interest & Savings Growth Calculator, Bank Profit Calculator — Pakistan (Savings & Term Deposits).
Assumptions
- Balance = deposit × (1 + nominal ÷ periods)^(periods × months ÷ 12); simple interest when interest is paid out.
- APY = (1 + nominal ÷ periods)^periods − 1; an APY input is converted back to nominal for the chosen frequency.
- Penalty = min(interest earned, deposit × nominal × months ÷ 12); real return uses (1 + after-tax APY) ÷ (1 + inflation) − 1.
Worked example
APY 4.594%; balance at maturity 26,742.38, interest 1,742.38 (about 97 a month). After 20% tax 1,393.90; real return after inflation about 1.15% a year. Withdrawn at month 6: 567.80 earned minus a 281.25 penalty leaves 25,287 — still above the deposit. At 12 months the same deposit earns 1,148.50; at 36 months about 3,606.
Frequently asked questions
How much interest will 10,000 earn in a year?
At 4.5% APY, about 450; at 5%, 500. Monthly compounding on a 4.5% nominal rate gives 459.
What is the difference between APY and interest rate?
The interest rate is the nominal annual figure; APY (or AER) is what you actually earn after compounding within the year — always slightly higher unless interest is paid out.
Is a CD better than a high-yield savings account?
Only if its rate is meaningfully higher and you will not need the money; savings accounts have no penalty and their rates move with the market.
Are fixed deposit returns taxed?
In most countries interest is taxable income — Pakistan withholds 15% (filers), the UK taxes above the savings allowance, the US taxes it as ordinary income; the UAE and Saudi Arabia do not tax it. Enter your rate.
How is CD interest calculated?
The deposit compounds at the nominal rate divided by the number of compounding periods, for each period until maturity; APY shows the resulting annual yield.
What is a CD ladder?
Splitting a sum across several deposits with staggered maturities so some money matures regularly while the rest earns longer-term rates.
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