APY to APR Converter (and APR to APY)

Loans & Borrowing

Updated Oct 2026 • Has calculator

Converts an Annual Percentage Yield (APY) to the nominal Annual Percentage Rate (APR), or an APR to APY, for any compounding frequency.

Calculate APY to APR

APY to APR Formula

APY = (1 + APR/n)^n − 1 · APR = n × ((1 + APY)^(1/n) − 1)

Convert

Rate to Convert

The APY or APR as advertised

Compounding Frequency

1=annually, 2=semi-annually, 4=quarterly, 12=monthly, 365=daily

Converted Rate

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Not investment advice.

What is APY to APR?

APR is the nominal annual interest rate and ignores compounding within the year. APY is the effective rate that includes it, so APY is always equal to or higher than APR. Converting between them lets you compare offers quoted on different bases: banks tend to advertise APY on savings accounts (the higher figure) and APR on loans (the lower one). Going from APR to APY applies the compounding; going from APY to APR reverses it. The more often interest compounds, the wider the gap between the two rates.

Worked Example

Monthly and daily compounding

Step 1 APY to APR: account advertises 5.00% APY, compounded monthly (n = 12)

Step 2 APR = 12 × ((1 + 0.05)^(1/12) − 1) = 4.8889%

Step 3 APR to APY: account pays 5.00% APR, compounded daily (n = 365)

Step 4 APY = (1 + 0.05/365)^365 − 1 = 5.1267%

Step 5 → The same 5% headline means a different rate depending on whether it is quoted as APY or APR

Source: CFA Institute — Time Value of Money in Finance (Refresher Reading) (2024-01-01)

How to Interpret APY to APR

< 2

Low rate — typical of standard savings or money market accounts

2 – 5

Moderate — competitive savings or CD rate

5 – 10

High — top-tier savings, or a low borrowing rate

> 10

Very high — typical of credit cards and higher-risk products

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Sources