Effective interest rate calculator

Effective annual interest rate or annual equivalent rate calculator.

Nominal annual interest rate: % per year
Compounding period:    
Compounding periods per year:    
 
Effective period interest rate: % per month
Effective annual interest rate: % per year

Effective interest rate calculation

Effective period interest rate calculation

The effective period interest rate is equal to the nominal annual interest rate divided by the number of periods per year n:

Effective Period Rate = Nominal Annual Rate / n

Effective annual interest rate calculation

The effective interest rate is equal to 1 plus the nominal interest rate in percent divided by the number of compounding persiods per year n, to the power of n, minus 1.

Effective Rate = (1 + Nominal Rate / n)n - 1

 

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