Enter an initial deposit, an interest rate (%), and the term of a certificate of a deposit into the CD calculator to determine the final value of the CD.

CD Return Formula

The following formula is used to calculate the return or final value of a certificate of deposit.

FV = IV (1 + r/m) ^ (t * m)

  • Where FV is the final value
  • IV is the initial value or deposit
  • r is the annual interest rate
  • m is the compounding frequency per year
  • t is the number of years.

CD Return Definition

CD return is defined as the total monetary value return on the investment of a certificate of deposit purchase.

How to calculate return on a certificate of deposit?

How to calculate the return on a certificate of deposit?

  1. Determine the total initial value

    This would be equal to the total cost of the CD times the number of certificates purchased

  2. Determine the rate of return

    Determine the yearly rate of return of the CD in percent

  3. Determine the total term of the CD

    Find out how long the CD is invested for in the number of years.


What is a certificate of deposit

A certificate of deposit, or CD, is a type of investment that typically yields higher returns than a savings account but has a fixed term length and must be re-drawn at the end of the investment term.

Is a certificate of deposit better than a savings account?

That depends on the individual. The CD is an extremely safe investment that will return a fixed %, but will also keep you money locked up for the term.

Certificate of Deposit or Stocks

It’s best to keep a balance of both CDs and stocks in an investment portfolio. CDs are extremely safe but won’t yield the same returns as other investments.

certificate of deposit return calculator
cd return formula