1. What is the Marcus CD Calculator?

The Marcus CD Calculator helps estimate earnings when refinancing a Certificate of Deposit (CD) using current rates (e.g., 4.20% APY for 9-month CD as of July 2025). It uses compound interest formula to project your investment growth.

2. How Does the Calculator Work?

The calculator uses the compound interest formula:

Where:

• \( A \) — Final amount ($)
• \( P \) — Principal investment ($)
• \( r \) — Annual interest rate (decimal)
• \( n \) — Compounding periods per year
• \( t \) — Time in years

Explanation: The formula accounts for compound growth where interest earns additional interest over time.

3. Importance of CD Rate Calculation

Details: Accurate CD earnings projection helps compare investment options, plan finances, and make informed decisions about CD laddering or refinancing.

4. Using the Calculator

Tips: Enter principal amount in dollars, annual interest rate as decimal (e.g., 4.2% = 0.042), term length in years (e.g., 0.75 for 9 months), and select compounding frequency.

5. Frequently Asked Questions (FAQ)

Q1: What are current Marcus CD rates?
A: As of July 2025, Marcus offers 4.20% APY for 9-month CD, but rates change frequently. Check their website for current offers.

Q2: How does compounding frequency affect earnings?
A: More frequent compounding (daily vs. monthly) yields slightly higher returns due to interest-on-interest effect.

Q3: Are CD earnings guaranteed?
A: Yes, CDs offer fixed rates for their term, unlike market investments. Early withdrawal may incur penalties.

Q4: When should I consider CD refinancing?
A: When current rates are significantly higher than your existing CD's rate, and the penalty for early withdrawal is outweighed by higher future earnings.

Q5: Are there tax implications?
A: CD interest is taxable as ordinary income in the year it's credited, unless in a tax-advantaged account like an IRA.