APY Calculator
Effective yearly yield with compounding.
Enter your values
ⓘ Live results
Results
- APY
- 4.594%
- Interest in year 1
- $459.40
- Balance after 1 year
- $10,459.40
- Balance after 5 years
- $12,517.96
Working
- 1APY = (1 + 0.045/12)^12 − 1 = 4.594%
Quick answer
APY is the effective annual return after compounding, so it is always equal to or higher than the stated nominal rate.
APY = (1 + r/n)^n − 1
How to use the APY Calculator
- 1Enter the advertised nominal rate.
- 2Pick the compounding frequency.
- 3Add a balance to see the dollar difference.
Worked example
Using the values the calculator loads with:
Inputs
- Nominal rate4.5 %
- CompoundingMonthly
- Starting balance10000 $
Results
- APY4.594%
- Interest in year 1$459.40
- Balance after 1 year$10,459.40
- Balance after 5 years$12,517.96
- APY = (1 + 0.045/12)^12 − 1 = 4.594%
Frequently asked questions
Is APY the same as APR?
No. APR describes borrowing cost, APY describes earning yield with compounding.
Does daily compounding matter much?
At normal rates the gap between daily and monthly is only a few hundredths of a percent.
About this calculator
- Built and reviewed by James Whitfield · How we build and test calculators
- Report an error
Results are estimates for general information. For medical, legal, structural or financial decisions, confirm with a qualified professional.