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APY Calculator

Verified formula Updated Jun 2026 Private — runs on your device

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Verified formula Private

Effective annual yield (APY)

12.683%

For general information only — not financial, tax, legal or medical advice. Verify before you rely on it.

How to use the APY Calculator

The APY Calculator works out your effective annual yield (apy) in an instant. Enter nominal annual rate and compounding frequency and the result updates as you type — it is free, needs no sign-up, and runs entirely in your browser so your figures stay private.

  1. Enter the nominal annual rate.
  2. Choose the compounding frequency.
  3. Read off your effective annual yield (apy) — the calculator updates automatically, with no button to press.

Formula

The APY Calculator uses the formula:

Effective annual yield (APY) = ((1 + Nominal annual rate ÷ 100 ÷ Compounding frequency)^(Compounding frequency) - 1) × 100

Worked example

For example, with nominal annual rate of 12% and compounding frequency of Monthly, the effective annual yield (apy) is 12.683%.

Inputs used
Nominal annual rate 12%
Compounding frequency Monthly
Results
Effective annual yield (APY) 12.683%

Results are estimates for educational use, not professional advice.

Key terms explained

APY
Annual Percentage Yield — the effective yearly return once compounding within the year is included.

Frequently asked questions

Annual percentage yield (APY) is the real rate you earn in a year once compounding is included. It is always equal to or higher than the nominal rate.

APY = (1 + r ÷ n)ⁿ − 1, where r is the nominal rate and n is how many times it compounds per year. A 12% nominal rate compounded monthly gives an APY of about 12.683%.

APR is the nominal annual rate without compounding within the year; APY includes that compounding. For comparing savings accounts, APY is the figure to look at.

Yes, but with diminishing returns. Daily compounding yields slightly more than monthly, which yields more than annual, for the same nominal rate.

Enter the nominal annual rate. Choose the compounding frequency. Read off your effective annual yield (apy) — the calculator updates automatically, with no button to press.

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