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APR to APY Converter

Convert between APR and APY for any compounding frequency, from yearly to daily or continuous.

Result

Enter your values and select Calculate to see the result.

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How the APR to APY Converter works

APR is the yearly interest rate before compounding; APY (also called the effective annual rate) includes the effect of interest earning interest. Choose a direction, enter the rate and pick how often interest compounds. The more often it compounds, the further APY rises above APR.

Formulas

APR to APY

APY = (1 + APR ÷ n)n − 1

n is compounding periods per year. Continuous compounding: APY = eAPR − 1.

APY to APR

APR = n × ((1 + APY)1 ÷ n − 1)

Examples

A credit card

An APR of 12% compounded monthly is an APY of 12.68%.

A savings account

5% compounded daily is an APY of 5.13%; compounded yearly, APR and APY are both 5%.

Frequently asked questions

Why do banks quote APY on savings but APR on loans?

The bigger-looking number sells better: APY makes savings look higher, APR makes loans look cheaper. Converting both to APY lets you compare fairly.

Does APR include fees?

On loans in many countries, the quoted APR includes some fees. This converter treats APR as a pure interest rate.

How much difference does daily compounding make?

Less than you might think: at 5%, going from monthly (5.12%) to daily (5.13%) adds about 0.01 percentage points.

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