Interest Rate Calculator
Find the rate on any loan
Formula
Find Interest Rate (Compound)
r = n × [(FV / P)^(1 / nt) − 1]
- r = Nominal annual interest rate
- FV = Future Value
- P = Principal
- n = Compounding periods per year
- t = Time in years
Simple Interest
I = P × r × t
- I = Interest earned
- P = Principal
- r = Annual interest rate (decimal)
- t = Time in years
FAQ
What is APR vs APY?
APR (Annual Percentage Rate) is the nominal rate without compounding. APY (Annual Percentage Yield) includes the effect of compounding. For savings, look at APY; for loans, compare APRs.
When is simple interest used?
Simple interest is used for short-term loans, auto loans, and some bonds. Most savings accounts, credit cards, and mortgages use compound interest.
How does compounding frequency affect my rate?
More frequent compounding (daily vs. annually) produces a higher effective rate from the same nominal rate. For example, 6% nominal compounded daily gives an effective APY of about 6.18%.