APY Calculator | Annual Percentage Yield Calculator

Calculate your investment's annual percentage yield (APY) and see how compound interest affects your returns over time.

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Understanding Annual Percentage Yield (APY)

What is APY?

Annual Percentage Yield (APY) shows the actual rate of return on an investment taking into account the effect of compound interest. Unlike simple interest rates, APY factors in how frequently interest is paid and added to the principal.

How APY Works

APY is calculated using the formula: APY = (1 + r/n)ⁿ - 1, where 'r' is the interest rate and 'n' is the number of times interest is compounded per year.

Why APY Matters

APY is particularly important when comparing different investment options, as it provides a standardized way to evaluate returns across various compounding frequencies. A higher APY means your money grows faster due to more frequent compounding.