Results
This calculator is for informational purposes only. Always confirm final terms, fees, and taxes with your financial institution or advisor.
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How to use this interest rate converter
Choose APR → monthly / daily / EAR if you already know a nominal APR and want the effective annual, monthly, or daily equivalent. Choose Periodic rate → APR / EAR if you already have a monthly, daily, or custom periodic rate and want to annualize it.
APR vs APY/EAR
APR is a nominal annual label, while APY/EAR reflects compounding. For savings products, APY/EAR is usually the better comparison number. For loans and cards, APR is often the disclosed rate, but comparing the effective annual result can reveal how much compounding changes the true yearly cost.
Monthly vs daily equivalent rates
The calculator also converts the effective annual result into equivalent monthly and daily rates. Use this when you need to compare a monthly statement rate, a daily accrual convention, or a quoted periodic rate from another product.
365-day vs 360-day basis
Daily rates depend on the day-count basis. Use 365 for an actual-day style comparison and 360 for banking-style conventions. Keep the same basis across products before comparing results.
What is excluded
This page compares rates only. Fees, teaser periods, taxes, balance transfer rules, and product-specific rounding are not included, so confirm final disclosures before making a financial decision.
See also
FAQ
How do you calculate the effective annual rate (EAR)?
EAR is calculated as (1 + i)^n - 1, where i is the periodic rate and n is the number of compounding periods per year. For example, with a 5% APR compounded monthly, i = 0.05 / 12 and EAR = (1 + i)^{12} - 1.
How are monthly and daily rates derived?
We start from the EAR and compute monthly as (1 + EAR)^{1/12} - 1 and daily as (1 + EAR)^{1/days} - 1. You can select 365-day actual or a 360-day banking convention for the daily calculation.
What is the difference between APR and EAR (APY)?
APR is a nominal annual rate that does not fully reflect intra-year compounding. EAR (effective annual rate) includes compounding, so for the same APR, higher compounding frequency leads to a higher EAR. APY is often used similarly to EAR, but exact definitions can vary by country or product disclosures.
When should I use 365 vs 360 for the daily basis?
The daily equivalent rate depends on an assumed day count. 365 days is a common “actual” basis, while 360 days is used in some banking conventions. Use the basis stated in the product terms so comparisons remain consistent.
Can I compare loans and savings directly with this?
Yes, as a rate-conversion check. This page helps you translate APR, APY/EAR, and periodic rates into the same convention first. For a full product comparison, you still need to account for fees, taxes, compounding rules, and balance behavior.
How it works
Definitions
- APR (nominal): annual rate label that does not directly include intra-year compounding.
- EAR (effective): the equivalent annual rate that reflects compounding.
- rp: rate per period (monthly, daily, etc.).
Formulas
- EAR = (1 + APR/m)m − 1 (m compounding periods per year)
- Monthly = (1 + EAR)1/12 − 1; Daily = (1 + EAR)1/D − 1 (D=365 or 360)
- APR = m · ((1 + EAR)1/m − 1)
Quick check
Example: APR 5% with m=12 → EAR ≈ 5.116%; monthly ≈ 0.417%.
Note
This tool does not include fees, taxes, or product-specific rounding rules. Use it for rate comparisons.
Last updated: 2025-11-07
Interpretation & real-world caveats
APR vs APY (EAR)
- APR is a nominal annual rate label. It may not include intra-year compounding.
- APY / EAR reflects compounding, so it’s usually the better choice for comparing yields across products.
- Definitions and disclosures vary by product and country—always check the stated compounding and day-count conventions.
Day-count basis (365 vs 360)
- Some products use 365 (“actual/365”) while others use 360 (“banking/360”) for daily equivalents.
- Mixing conventions can skew comparisons. Use the basis stated in the product terms.
Quick example
APR 20% compounded daily (m=365) corresponds to APY (EAR) ≈ 22.13%.