39 · Calculators

APR to APY Calculator

Enter an APR and how often it compounds to see the effective annual rate you actually earn or pay.

APY (effective annual rate)

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How to use the apr to apy calculator

  1. Enter the nominal yearly rate (APR).
  2. Choose how often interest compounds.
  3. Read the effective annual rate (APY).

Why APY is higher

When interest compounds, each period’s interest earns interest too. APY = (1 + APR ÷ n)n − 1, where n is the number of compounding periods a year. The more often it compounds, the bigger the gap.

Examples

5% APR compounded monthly

5.1162% APY

5% APR compounded daily

5.1267% APY

Questions

Which should I compare?

Compare APY with APY. For savings a higher APY is better; for loans the effective rate shows the true cost.

Does APR include fees?

On loans, APR often includes some fees. This tool only converts the rate.