Savings & Banking
CD Early Withdrawal Penalty Calculator
Break a CD early and the bank charges a penalty — usually several months of interest. Enter your deposit, rate, how long you've held it, and the penalty terms to see the interest earned, the penalty, and the net amount you'd actually receive.
You'd walk away with
$10,000
Deposit plus interest earned, minus the penalty.
- Interest earned
- $250
- Early-withdrawal penalty
- $250
- Net gain vs. your deposit
- $0
What you're ahead after the penalty.
How this calculator works
Interest accrues simply on the principal at the CD's rate for the months held. The penalty is the same monthly interest times the penalty months. Net amount = principal + interest earned − penalty; the net gain can be negative when the penalty exceeds the interest.
A simplified model — real CDs may compound interest and calculate penalties slightly differently (some on principal, some on interest), and terms vary by bank. Check your specific CD's disclosure for the exact penalty formula.
Try an example
Frequently asked questions
How is a CD early withdrawal penalty calculated?
The penalty is typically a set number of months of interest — often 3 months on short CDs and 6–12 months on longer ones — regardless of how much you've actually earned. It's calculated on your rate and principal, so a 6-month penalty on a 5% CD of $10,000 is about $250.
Can an early withdrawal penalty take my principal?
Yes. If you withdraw before you've earned enough interest to cover the penalty, the bank takes the difference from your principal — so you get back less than you deposited. This is most likely when you cash out in the first few months of a CD with a long penalty period.
When is it worth breaking a CD early?
When the benefit outweighs the penalty — for example, if rates have risen enough that reinvesting at the new rate beats the penalty, or you genuinely need the cash. Compare the penalty here against what you'd gain elsewhere. Sometimes a small penalty is worth escaping a low locked-in rate.
Are there CDs with no early withdrawal penalty?
Yes — 'no-penalty' (or 'liquid') CDs let you withdraw without a fee, usually in exchange for a slightly lower rate. They're a middle ground between a standard CD and a savings account, useful when you want a fixed rate but might need access to the money.
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Disclaimer: DayCents provides this calculator for educational purposes only. Results are estimates based on your inputs and the stated assumptions — they are not financial advice, a quote, or an offer of credit. Consult a qualified financial professional before making major money decisions.