A stated rate (APR) and its true yearly yield (APY) differ once compounding is counted. Convert either way.
Edit APR or APY, the other updates automatically.
An APR-to-APY calculator converts a stated (nominal) interest rate into its true annual yield once compounding is counted, and back again. It's the fair way to compare savings and loan offers.
APR is the stated rate before compounding; APY is what you actually earn or owe once compounding is counted. The gap between them grows with how often interest compounds, the same APR compounded daily produces a higher APY than compounded annually. That's why the two numbers rarely match on real accounts.
Savings products are usually quoted in APY and loans in APR, which can make offers look closer than they are. To compare fairly, convert everything to the same measure, APY against APY for what you earn, APR against APR for what you pay. This converter lets you line up any two offers on equal footing.
APR is the stated rate before compounding; APY reflects compounding and is the true yearly figure. Savings accounts quote APY; loans quote APR.
The more often interest compounds, the higher the effective yield for the same stated rate, daily compounding beats annual.
Compare like with like: APY vs APY for savings, APR vs APR for loans. This tool converts between them.
See the exact formula and a worked example on our methodology page.