CD & Savings Calculator
Calculate CD interest earnings, compare savings products, and build a CD ladder.
CD / Savings Details
Total Interest Earned
$486
Final Balance: $10,486
Effective APY
4.86%
After Tax
$370
Early W/D Penalty
$122
Summary
CD Ladder Builder
Split your deposit across 5 CDs with staggered maturities for better liquidity and rates.
Disclaimer
- APY and terms based on current market conditions — rates change frequently.
- CD interest is taxed as ordinary income (federal + state).
- FDIC insured up to $250,000 per depositor, per bank.
Understanding Certificates of Deposit (CDs)
A certificate of deposit (CD) is a savings product that pays a fixed interest rate for a set term — typically 3 months to 5 years. In exchange for locking up your money, you earn a higher rate than a regular savings account. In 2026, top CD rates range from 4.0% to 5.0% APY depending on the term and institution, significantly above the national savings average of around 0.45%.
CD vs High-Yield Savings Account
| Feature | CD | High-Yield Savings |
|---|---|---|
| Rate | Fixed for full term | Variable, can change anytime |
| Liquidity | Penalty for early withdrawal | Withdraw anytime |
| Best for | Known future expense (1-5 years) | Emergency fund, flexible savings |
| FDIC insured | Yes, up to $250K | Yes, up to $250K |
| Typical APY (2026) | 4.0-5.0% | 4.0-4.5% |
What Is a CD Ladder?
A CD ladder splits your deposit across multiple CDs with staggered maturity dates. For example, with $10,000 you might buy five CDs: 1-year, 2-year, 3-year, 4-year, and 5-year. Each year when one matures, reinvest it in a new 5-year CD (typically the highest rate). This strategy provides regular liquidity while capturing long-term rates. Our calculator builds a customized ladder based on your total deposit.
CD Interest and Taxes
CD interest is taxed as ordinary income — at your marginal federal rate plus state taxes. A 5% CD in the 24% bracket yields an effective 3.8% after federal tax. Treasury bills, by comparison, are exempt from state taxes, which can make them more attractive in high-tax states like California or New York.
FDIC — Deposit Insurance Coverage→Frequently Asked Questions
What happens if I withdraw from a CD early?
Most banks charge an early withdrawal penalty — typically 3-6 months of interest depending on the term length. On a 12-month CD with a 6-month penalty, withdrawing at month 4 means you lose all earned interest plus some principal. Some online banks offer no-penalty CDs with slightly lower rates.
Are CDs worth it in 2026?
With rates at 4-5%, CDs are historically attractive. They make sense for money you won't need for 6-60 months, especially if you want to lock in today's rate before potential Fed rate cuts. For shorter horizons or emergency funds, high-yield savings remains more flexible.
Should I buy CDs or Treasury bills?
T-bills offer similar yields and are exempt from state income tax. In states with high income taxes (CA, NY, NJ), T-bills often provide a higher after-tax return. CDs are simpler to buy and FDIC-insured, making them a good choice for those who prefer banking at one institution.
See how compound interest grows your investments over time with our Compound Interest Calculator.