CD Calculator

A certificate of deposit (CD) is a savings product offered by banks and credit unions with a fixed interest rate and fixed maturity date. CDs typically offer higher interest rates than regular savings accounts in exchange for committing funds for a specified term, which can range from a few months to several years.

CDs are insured by the FDIC (or NCUA for credit unions) up to $250,000, making them one of the safest investment options. The trade-off is that early withdrawal typically incurs a penalty (usually several months of interest), so CDs are best suited for money that won't be needed before maturity.

CD laddering is a strategy that involves purchasing CDs with staggered maturity dates. This provides regular access to portions of the investment while maintaining higher overall yields. When each CD matures, the proceeds can be reinvested in a new long-term CD, maintaining the ladder structure.