APY Calculator

APR (annual percentage rate) is the stated nominal interest rate before compounding. APY (annual percentage yield) is the actual rate you earn (or pay) in a year once compounding is factored in. APY is always equal to or higher than APR for the same nominal rate, because it accounts for interest earning interest.

APY = (1 + r/n)^n − 1, where r is the nominal annual interest rate (as a decimal) and n is the number of compounding periods per year. For example, a 5% APR compounded monthly gives an APY of about 5.116%.

Yes, for the same nominal rate — daily compounding yields a slightly higher APY than monthly, which yields higher than quarterly, which yields higher than annual. The difference is usually small (a few hundredths of a percent) at typical savings rates.

APY gives a true apples-to-apples comparison between accounts that compound at different frequencies, since it already reflects the full compounding effect. Regulations (Truth in Savings Act) require banks to disclose APY for deposit accounts.

Interest earned = principal × APY × (time in years), assuming you don't add or withdraw funds. Enter your balance below to see your projected interest earned over your chosen time period.

Yes — enter an optional monthly contribution amount and this calculator adds the future value of those contributions (compounded monthly at your APY) to your starting balance's growth, giving you a total projected balance for savings accounts you're actively adding to.