Comparing a Savings Account
Example Input
APY: 5.00%, compounded monthly.
Sample Output
Equivalent APR: ~4.89% nominal annual rate, compounded monthly.
Free browser-based estimate
APY to APR Calculator
Convert between APY and APR for any compounding frequency, so savings rates and loan rates can be compared fairly. Review the assumptions and verify important figures with current official sources.
Your assumptions
Inputs stay localAPR (nominal annual)
4.9%
APY (effective annual)
5.0%
Compounding
12x per year
How to read this estimate
APY (effective annual yield) includes compounding; APR (nominal annual rate) does not. APY = (1 + APR/n)^n - 1 and APR = n x ((1 + APY)^(1/n) - 1), where n is compounding periods per year. Loans are usually quoted in APR; deposit accounts in APY.
Independent planning tool. Results are estimates based on the values and assumptions shown. This is not financial, tax, legal, mortgage, or pension advice.
Check the official guidance: CFPB - interest rate vs. APR explained•
Privacy note:Calculations run locally in your browser. Your entered financial figures are not sent to our calculator server.
What is an APY to APR Calculator?
An APY-to-APR calculator converts between the two annual rate conventions: APY (annual percentage yield, the effective rate including compounding) and APR (annual percentage rate, the nominal rate without it). Both directions are supported across daily, monthly, quarterly, and annual compounding.
Who Should Use This Tool?
Savers comparing deposit accounts quoted in APY, borrowers comparing loans quoted in APR, investors evaluating CD or money-market offers, and anyone checking whether a quoted rate matches its advertised effective yield.
Examples
Actionable Use Cases
A 5.00% APY compounded monthly equals roughly a 4.89% APR - that is the nominal rate the bank actually applies each month. Conversely, a 6% APR compounded monthly produces a 6.17% APY. Convert both sides to the same convention before comparing offers from banks and lenders.
How the Calculation Works
APY = (1 + APR/n)^n - 1 and APR = n x ((1 + APY)^(1/n) - 1), where n is the compounding periods per year (365 daily, 12 monthly, 4 quarterly, 1 annually). More frequent compounding widens the gap between the two figures.
Common Mistakes and Limitations
APR on loans can also include fees, which this calculator does not model - a loan APR with fees is not directly comparable to a deposit APY. The conversion assumes the quoted rate stays constant all year and ignores taxes and rate changes.
FAQ
What is the difference between APY and APR?
APY (annual percentage yield) is the effective annual return including compounding. APR (annual percentage rate) is the nominal annual rate without compounding. The same nominal rate produces a higher APY as compounding becomes more frequent.
Why is APY higher than APR?
Compounding earns interest on interest. A 5% APR compounded monthly effectively yields about 5.12% because each month's interest adds to the balance the next month is calculated on.
Which one should I use to compare offers?
Use APY to compare savings and deposit accounts, and APR to compare loan costs - but make sure both offers use the same convention and that loan APRs include or exclude fees consistently.
Why Use Our APY/APR Converter?
Convert nominal APR into effective annual yield across daily, monthly, and quarterly compounding frequencies. Accurately compare high-yield savings accounts against certificate of deposit terms with instant, private browser execution.
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