APY/APR Converter
Convert between Annual Percentage Rate (APR) and Annual Percentage Yield (APY)
Enter rate percentage
Comparison
| Frequency | Periods/Year | APY |
|---|---|---|
| Annually | 1 | 5.0000% |
| Quarterly | 4 | 5.0945% |
| Monthly | 12 | 5.1162% |
| Bi-weekly | 26 | 5.1221% |
| Weekly | 52 | 5.1246% |
| Daily | 365 | 5.1267% |
| Continuous | ∞ | 5.1271% |
APY by Frequency
About APY vs APR
APR is the nominal annual rate without compounding. APY includes the effect of compounding.
APY is always higher than APR when compounding occurs more than once per year.
Banks advertise APY for savings accounts and APR for loans — be aware of the difference.
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What is this tool?
The APY/APR Converter converts between Annual Percentage Rate (nominal rate) and Annual Percentage Yield (effective rate with compounding). Different compounding frequencies—daily, weekly, monthly, quarterly, annually, and continuous—produce different effective yields from the same nominal rate.
How to use
- 1
Enter rate and frequency
Input the rate and select the compounding frequency (daily, monthly, etc.).
- 2
View conversion
See the converted APY/APR with the formula and explanation.
- 3
Compare frequencies
A table shows how different compounding frequencies affect the effective yield.
Frequently Asked Questions
What is the difference between APR and APY?
APR is the nominal annual rate without compounding. APY is the effective annual rate including compounding effects. With daily compounding at 5% APR, the APY is ~5.13%.
Why does compounding frequency matter?
More frequent compounding means interest is calculated on interest more often, producing a higher effective yield. Daily compounding beats monthly, which beats annually.
What is continuous compounding?
Continuous compounding is the theoretical limit where interest compounds infinitely fast. The formula is APY = e^APR - 1, where e is Euler's number (~2.718).