Effective Interest Rate Calculator

This calculator calculates the effective interest rate for a given nominal interest rate and compounding frequency.

This page exists due to the efforts of the following people:

Timur

Timur

khajit_94

cruelity0_0

Created: 2015-12-24 21:19:36, Last updated: 2023-04-06 03:43:26

The effective interest rate is the actual amount of interest earned or paid on an investment or loan over a specific period of time, taking into account the effect of compounding. The calculator allows the user to enter the nominal interest rate and the compounding frequency (such as monthly, quarterly, or annually), and then calculates the corresponding effective interest rate.

Effective interest rate formula
i = \left( 1+ \frac{j}{m} \right)^m - 1
where j - nominal interest rate,
m - the number of interest accrual periods

It is clear that for the same nominal interest rate, a more frequent accrual period results in a more profitable investment.

PLANETCALC, Nominal interest rates сomparison

Nominal interest rates сomparison

Nominal interest rates

PercentsAccrual Period
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Digits after the decimal point: 2
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PLANETCALC, Effective Interest Rate Calculator

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