See what breaking a CD before maturity takes out of your deposit
Estimates only, not financial advice. What you type stays on your device. Updated on 24 Oct 2026.A certificate of deposit penalty is stated as a number of months of interest, and the bank charges it whether or not that much interest has been earned. Break a five-year CD in its first month with a six-month penalty and you get back less than you put in. Enter your deposit, rate, term and penalty to see exactly what would come back on the day you are thinking of.
Enter the Deposit, the rate and the Term of the CD you already hold.
Type the Penalty stated by the bank, in months of interest, from your account agreement.
Set Withdraw in month to the month you would cash out; it opens at month 6.
Read the warning box for what comes back that month, and whether it is less than your deposit.
A certificate of deposit is the simplest product a bank sells: one deposit, one rate, one date. The arithmetic behind it is one line — the balance after t years is the deposit multiplied by (1 + APY) raised to t — and two things still trip people up.
The first is which rate to use. American banks advertise the APY, the annual percentage yield, and the APY already includes compounding. A CD at 5.00% APY turns 10,000 into exactly 10,500 after a year whether the bank compounds daily, monthly or once. Feeding that advertised figure into a calculator that then compounds it daily gives about 10,513 instead, and a number 13 dollars too high on a one-year deposit is enough to make the wrong account look better. This page asks which number you have. Enter the APY and nothing further is applied; enter the nominal rate and the compounding you chose is applied to it, with the resulting APY shown so you can compare offers on equal terms.
The second is the penalty. Banks state early withdrawal penalties as a number of months of interest — three months on a one-year CD, six or twelve on a five-year one — and they charge it whether or not that much interest has been earned. Break a five-year CD in its first month with a six-month penalty and you get back less than you deposited. That case is shown here as a real loss rather than quietly floored at your deposit, because the loss is the whole point of the question.
The rest of the article, and all 7 questions about CD Calculator, are on the CD Calculator page.
Multiply your deposit by one plus the APY, raised to the number of years. A 10,000 deposit at 5.00% APY for one year comes to 10,500; the same deposit for three years comes to 11,576. Enter your own figures above and the year-by-year path is shown beneath the total.
Yes, and it is commoner than people expect. The penalty is a fixed number of months of interest and the bank charges it whether or not that much has been earned, so a long CD broken in its first weeks returns less than was deposited. Enter the withdrawal month to see the real figure.
Take the deposit, multiply by the nominal annual rate, then by the penalty months divided by twelve. A three-month penalty on 10,000 at a 4.88% nominal rate is about 122. That amount comes off the balance on the day you withdraw, not off the interest you happen to have earned.
CD interest counts as ordinary income and is taxed in the year the bank credits it, not the year the CD matures. A five-year CD therefore produces a 1099-INT every year. Enter your marginal rate above to see interest after tax, and treat the result as an estimate rather than tax advice.
Formula only: no rates or limits are read from an official source.
Still stuck? Ask about CD Calculator and anybody who knows can answer. No account needed.
Same job, other tools: FD Calculator for Senior Citizens – Senior citizen FD interest, monthly or quarterly, with the extra rate added · FD Interest Calculator – Monthly or quarterly interest from a fixed deposit, and the total over the term.
On the related tools: Step-up SIP Calculator – See how raising your SIP every year changes the final corpus.
In the collection Savings and Deposit Calculators.