About APR and APY
This tool converts between APR (the nominal annual rate) and APY (the effective annual yield), for any compounding frequency. Because interest compounds, the rate you actually earn or pay (APY) differs from the headline APR — and this calculator shows exactly how much. It runs entirely in your browser.
How APR APY works
How to use it
- Enter a rate and say whether it is APR or APY.
- Choose how often interest compounds.
- Read the converted rate.
APR vs APY
APR is the simple nominal rate; APY (or EAR) includes the effect of compounding. APY = (1 + APR/n)^n − 1, where n is the number of compounding periods per year.
Why it matters
More frequent compounding raises the effective rate. Comparing accounts or loans by APY (rather than APR) gives a true like-for-like comparison.
Common uses
- Convert APR to APY
- Convert APY back to APR
- Compare savings accounts fairly
- Understand the effect of compounding
- Check a loan or card effective rate
- Compare offers with different compounding
- Find the effective annual rate
- Learn how APY works
Frequently asked questions
What is the difference between APR and APY?
APR is the nominal rate; APY includes compounding and reflects what you really earn or pay.
How do I convert APR to APY?
APY = (1 + APR/n)^n − 1, where n is compounding periods per year — the tool does it for you.
Why is APY higher than APR?
Because interest earns interest when it compounds more than once a year.
Which should I compare?
APY gives a true like-for-like comparison between accounts.
What compounding should I choose?
Match the account or loan — daily, monthly, quarterly or yearly.
Is my data uploaded?
No — it calculates in your browser.
Is APY the same as EAR?
Yes — APY and effective annual rate mean the same thing.
Is it free?
Yes — completely free with no sign-up.