5 Year Cd Ladder Calculator - Savvy Calculator

Introduction

Calculating the returns on a 5-year CD ladder can be a complex task, requiring precision and accuracy. To simplify this process, we’ll create a user-friendly calculator using HTML and JavaScript. This article will guide you through the calculator’s usage, provide the accurate formula for calculations, and offer examples for better understanding.

How to Use

Open the HTML file in your preferred browser.
Input the necessary values in the designated fields.
Click the “Calculate” button to obtain the results instantly.

Formula

The formula for calculating the future value of a 5-year CD ladder is:

$F V = P \times (1 + r / n)^{n t}$

Where:

$F V$ is the future value,
$P$ is the principal amount (initial investment),
$r$ is the annual interest rate (decimal),
$n$ is the number of times interest is compounded per year, and
$t$ is the number of years.

Example

Suppose you invest $10,000 with an annual interest rate of 3.5%, compounded quarterly. After 5 years, the future value ( $F V$ ) can be calculated as follows:

$F V = 10000 \times (1 + 0.035/4)^{4 \times 5}$

FAQs

Q: How often is interest compounded?
A: Input the number of times interest is compounded per year in the “Compounded per Year” field.

Q: Is the interest rate in percentage format?
A: Yes, enter the annual interest rate in percentage format (e.g., 3.5 for 3.5%).

Conclusion

With this simple HTML and JavaScript calculator, you can effortlessly compute the future value of your 5-year CD ladder investments. Ensure accurate inputs, and the tool will provide precise results, aiding you in financial planning.