APY Calculator

Convert an interest rate (APR) to APY for any compounding schedule, compare two rates on the same balance, and see the dollar interest a balance earns in a year.

APY is what a rate actually pays once compounding is counted. Enter a nominal rate and how often it compounds to get the APY, and a balance to see the interest in dollars.

Interest rate (APR / nominal)

Compounding Balance

Compare with another APY (optional)

For example the national average for traditional savings accounts.

The formula

APY = (1 + r/n)^n - 1, where r is the nominal annual rate and n the number of compounding periods per year. Daily compounding at 4.00% gives 4.08% APY; monthly gives 4.07%. The difference between schedules is small; the difference between banks is not.

APY vs APR

Savings accounts and CDs advertise APY because it is the larger, honest number for money you earn. Loans and credit cards advertise APR because it is the smaller number for money you pay; the true annual cost of a card that compounds daily is higher than its APR.

Frequently asked

What is the difference between APY and APR?

APY includes compounding; APR does not. For the same nominal rate, APY is always slightly higher, and the gap grows with the rate and the compounding frequency.

Is a higher APY always better?

For a savings product, yes, all else equal. Check minimum balances, fees and whether the rate is a temporary promotion.

How much is 4% APY on $10,000?

About $400 in the first year, $408 in the second as interest earns interest.