APY Calculator
Calculate APY (annual percentage yield) from a nominal interest rate and any compounding frequency. Free, no sign-up.
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What is APY Calculator?
The APY Calculator is a free, browser-based financial tool that converts a nominal (APR) interest rate into the Annual Percentage Yield — the true effective annual rate that accounts for compounding. It covers seven compounding schedules from daily to annual, includes continuous compounding for reference, and can project an ending balance from a principal and time period. Everything runs locally in your browser with no data sent anywhere.
Key Benefits
- Instant APY conversion for any nominal rate
- Seven compounding frequencies compared side by side
- Continuous compounding included for the theoretical maximum
- Balance projection with principal and years
- Works fully offline, free, and without signup
Common Use Cases
- •Comparing savings accounts, CDs, and money market yields
- •Checking the real cost of loans and credit cards
- •Evaluating bond or investment effective returns
- •Learning how compounding frequency changes yields
How to Use the APY Calculator
- Enter the nominal rate: Type the annual nominal interest rate (APR) your bank or account quotes, for example 5 for 5%.
- Pick the compounding frequency: Choose how often interest compounds: daily, weekly, biweekly, monthly, quarterly, semiannual, or annually.
- Add principal and years (optional): Enter an amount and a time period to see the projected ending balance at the effective APY.
- Review and copy: Check the APY, the difference from the nominal rate, and the full comparison table, then copy the summary.
Key Features
- Converts any nominal rate into APY with one click
- Effective-rate table across 7 compounding frequencies
- Continuous compounding APY shown for comparison
- Balance projection from principal and time period
- Highlights the selected frequency in the table
Frequently Asked Questions
What is the difference between APY and APR?
APR (Annual Percentage Rate) is the nominal interest rate quoted without compounding. APY (Annual Percentage Yield) includes the effect of compounding, so it is always equal to or higher than APR. For example, a 5% APR compounded monthly produces an APY of about 5.12%.
Why does compounding frequency matter?
The more often interest compounds, the more interest you earn on previously earned interest. At the same nominal rate, daily compounding produces a slightly higher APY than monthly, and monthly higher than annual. The comparison table in this tool shows the exact effective rate for each schedule.
What is continuous compounding?
Continuous compounding assumes interest is compounded an infinite number of times per year, which gives the theoretical maximum APY for a given nominal rate. It is calculated as e^r - 1, where r is the nominal rate in decimal form and e is Euler's number (about 2.71828).
Is APY the same as the effective annual rate (EAR)?
Yes. APY and EAR describe the same concept: the true annual return including the effect of compounding. Both use the formula (1 + r/n)^n - 1, where r is the nominal rate and n is the number of compounding periods per year.