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Understanding Certificate of Deposit (CD) Calculator and How to Use It? To receive income on investments with minimal risk, many people choose to invest in certificates of deposit (CDs). CDs are a good alternative for those seeking a consistent and predictable income stream because they offer a guaranteed rate of return for a specified time period. In this article, I'll explain what a certificate of deposit (CD) is, how it grows in value over time, and how to use a CD calculator to figure out how much money you may make with one. What is a Certificate of Deposit (CD)? The interest rate on a Certificate of Deposit (CD) is usually higher than the interest rate on a standard savings account. Certificates of deposit (CDs) are savings instruments issued by financial institutions and protected by the FDIC up to a $250,000 maximum. A wide range of CD term durations are available, from a few months to several years. In general, the longer the loan duration, the greater the interest rate wi...