APY Calculator: Convert APR to APY (and Back)
APY is the rate you actually earn in a year once interest compounds. Enter an interest rate and how often it compounds to get the APY, or enter an APY to get the interest rate behind it.
4.341% APY
An interest rate of 4.250% compounded daily equals 4.341% APY. $10,000 earns $434.13 in one year.
| Compounding | APY |
|---|---|
| daily | 4.341% |
| monthly | 4.334% |
| quarterly | 4.318% |
| annually | 4.250% |
Today's best 1 year CD rates
- Popular Direct 4.60% 12 months
- Barclays 4.50% 12 months
- Sallie Mae Bank 4.50% 12 months
- Capital One 4.40% 11 months
- Marcus by Goldman Sachs 4.40% 12 months
From the institutions we track, verified daily. See all rates.
The APY formula
APY = (1 + APR / n)n − 1, where n is the number of times interest compounds per year (365 for daily, 12 for monthly).
Example: 4.20% compounded daily is (1 + 0.042/365)365 − 1 = 4.29% APY. On $10,000 that is $429 in a year instead of $420.
Banks must quote APY on deposit accounts under the Truth in Savings Act, so APYs from different banks compare directly. Crypto platforms also quote "APY", but those yields are not deposits and are not FDIC- or NCUA-insured.
Questions
What is the difference between APR and APY?
APR (or the interest rate) is the simple annual rate. APY includes the effect of compounding, so it is equal to or higher than the APR. Deposit rates are compared by APY.
Does more frequent compounding matter?
A little. At 4%, daily compounding gives 4.08% APY and monthly gives 4.07%. Once you know the APY, the compounding frequency is already included.