Arrowhead Credit Union CD Rates Calculator
Understanding CD Rates and Your Earnings
A Certificate of Deposit (CD) is a savings product offered by financial institutions like Arrowhead Credit Union that provides a fixed interest rate over a specified term. CDs are a popular choice for individuals looking for a safe and predictable way to grow their savings, as they typically offer higher interest rates than traditional savings accounts. The key components to understanding your CD's potential earnings are the initial deposit, the Annual Percentage Yield (APY), and the term length.
The Initial Deposit is the principal amount you invest when opening the CD. The APY represents the total amount of interest you will earn on your deposit over one year, taking into account the effect of compounding. It's crucial to look at the APY rather than just the stated interest rate, as APY provides a more accurate picture of your actual return. The Term, measured in months, is the duration for which your money is locked into the CD. Longer terms often come with higher APYs, but they also mean your funds are inaccessible for a longer period without penalty.
This calculator helps you estimate the potential earnings from your Arrowhead Credit Union CD. By inputting your initial deposit, the offered APY, and the CD's term in months, you can quickly see how much interest your investment could generate. Remember that early withdrawal penalties may apply if you need to access your funds before the term ends. Always consult Arrowhead Credit Union directly for the most current rates and terms, as these can change frequently.
function calculateCDInterest() {
var initialDeposit = parseFloat(document.getElementById("initialDeposit").value);
var annualPercentageYield = parseFloat(document.getElementById("annualPercentageYield").value);
var termInMonths = parseFloat(document.getElementById("termInMonths").value);
var resultDiv = document.getElementById("result");
resultDiv.innerHTML = ""; // Clear previous results
if (isNaN(initialDeposit) || initialDeposit <= 0) {
resultDiv.innerHTML = "Please enter a valid initial deposit amount.";
return;
}
if (isNaN(annualPercentageYield) || annualPercentageYield < 0) {
resultDiv.innerHTML = "Please enter a valid APY (cannot be negative).";
return;
}
if (isNaN(termInMonths) || termInMonths <= 0) {
resultDiv.innerHTML = "Please enter a valid term in months (must be greater than 0).";
return;
}
// Convert APY to a decimal for calculation
var annualInterestRate = annualPercentageYield / 100;
// Calculate the total interest earned over the term.
// This is a simplified calculation for illustrative purposes.
// Actual CD interest might compound differently (daily, monthly, etc.)
// For a more precise calculation, one would need to know the compounding frequency.
// This formula calculates simple interest for the period, then adds it to principal.
// A more accurate compound interest formula would be: P(1 + r/n)^(nt) – P
// where P is principal, r is annual rate, n is compounding frequency per year, t is time in years.
// For simplicity and common CD understanding, we'll estimate the total value.
var termInYears = termInMonths / 12;
var estimatedTotalValue = initialDeposit * Math.pow((1 + annualInterestRate / 12), termInMonths); // Assumes monthly compounding
var totalInterestEarned = estimatedTotalValue – initialDeposit;
var formattedInitialDeposit = initialDeposit.toLocaleString('en-US', { style: 'currency', currency: 'USD' });
var formattedTotalInterest = totalInterestEarned.toLocaleString('en-US', { style: 'currency', currency: 'USD' });
var formattedEstimatedTotalValue = estimatedTotalValue.toLocaleString('en-US', { style: 'currency', currency: 'USD' });
resultDiv.innerHTML = `
Estimated CD Earnings
Initial Deposit: ${formattedInitialDeposit}
APY: ${annualPercentageYield}%
Term: ${termInMonths} months
Estimated Total Interest Earned: ${formattedTotalInterest}
Estimated Total Value at Maturity: ${formattedEstimatedTotalValue}
Note: This is an estimate assuming monthly compounding. Actual earnings may vary based on the specific compounding frequency and any fees or penalties.
`;
}
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