APR to APY calculator
Two rates with the same headline number can pay differently depending on compounding; this shows the gap.
Loading the tool…
Processing and privacy: The result is calculated inside your browser and your data is not sent to any server.
How to use it
- Enter nominal rate (apr) and compounding frequency.
- The result appears straight away and updates as you edit.
- Copy the result, or copy a link that keeps the same values to share it.
How it is calculated
APY = (1 + APR/n)^n − 1, and with continuous compounding APY = e^APR − 1.
Example
Inputs: Nominal rate (APR) = 5 %, Compounding frequency = Monthly. Result: APY: 5.1162%; Difference from APR: 0.1162 percentage points.
Limits and caveats
- Converts the rate only; it does not add fees that some loan APR definitions include.
- Assumes the rate is fixed for the year.
Questions about this tool
What is the difference between APR and APY?
APR is the nominal rate without compounding. APY is what you actually earn in a year once interest earns interest.
Which should I compare between banks?
Compare APY, because it evens out different compounding schedules.
What is continuous compounding?
The theoretical limit as compounding gets infinitely frequent. It gives the highest APY for a given APR.