EAR
Effective Interest Rate Calculator
The real yearly rate (EAR, or APY) a nominal rate becomes once it compounds.
Result…
How it's calculated
EAR = (1 + r ÷ n)^n − 1 Continuous: EAR = e^r − 1
A nominal rate compounded more than once a year earns interest on interest within the year, so its effective rate is higher. Compare savings or loans by the effective rate. The chart shows the same nominal rate at every compounding frequency.
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