APR and APY sound alike, but they aren’t the same. This APR to APY calculator converts one to the other for any compounding schedule and shows what the difference means in real dollars. Use it to compare savings accounts, CDs and loans on equal footing.
APR to APY Calculator
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APR vs. APY
- APY (annual percentage yield) includes the effect of compounding. Banks quote APY for savings accounts, money market accounts and CDs, so it’s the number to compare when you’re saving.
- APR (annual percentage rate) is the yearly rate charged on a loan or credit card, and for loans it includes most fees. It’s the number to compare when you’re borrowing.
The formula: APY = (1 + APR ÷ n)n − 1, where n is the number of compounding periods per year. A 5% APR compounded monthly equals about a 5.116% APY.
Related: Best CD Rates, High-Yield Savings Accounts, Savings Calculator, All Financial Calculators.