APR / APY Calculator
Convert between nominal APR and effective APY at any compounding frequency.
APR / APY measurements
Enter your values, then calculate.
Enter any 2 of the 3 values below, leave the rest blank, then select Calculate.
Result
How to calculate apr / apy
This calculator converts between nominal APR and effective APY, or solves for the compounding frequency — useful since the two rates diverge more as compounding frequency increases, and lenders/banks sometimes advertise whichever number looks better.
How the calculation works
APY = (1 + APR/100/n)^n − 1, where n is compounds per year. Solving the other direction: APR = n × ((1 + APY/100)^(1/n) − 1).
Example
A 6% nominal APR compounded monthly (n=12): APY = (1 + 0.06/12)^12 − 1 ≈ 6.17%. The more frequently interest compounds, the larger the gap between APR and APY becomes.
Frequently asked questions
Why do APR and APY differ?
APR is the simple annual rate before compounding; APY reflects the actual return after compounding is applied within the year. The more frequently interest compounds, the more APY exceeds APR at the same nominal rate.
APR / APY Calculator
APY = (1 + APR/100/n)^n − 1, where n is compounds per year. Solving the other direction: APR = n × ((1 + APY/100)^(1/n) − 1).
Let's understand your apr / apy result.
Calculate a result above and this guide will help you interpret it using this calculator's own formula and explanation.
Pro Tips for APR / APY
- Always compare loans and savings accounts by APY (or APR, consistently) — mixing the two when comparing offers can make a worse deal look better.
- Daily compounding produces a slightly higher APY than monthly compounding at the same nominal APR, though the difference is usually small.
Common APR / APY Mistakes to Avoid
- Comparing one account's APR against another account's APY as if they were the same figure — always convert to the same basis first.
When to Use This Calculator
This calculator converts between nominal APR and effective APY, or solves for the compounding frequency — useful since the two rates diverge more as compounding frequency increases, and lenders/banks sometimes advertise whichever number looks better.