Effective Annual Rate Calculator (APR–EAR)

Convert a nominal annual interest rate into an effective annual rate using the compounding frequency.

Formula

EAR = (1 + APR / m)^m − 1.

Source / method note

Effective annual rate formula: (1 + nominal rate / periods)^periods − 1.

Legal / official rate note

The true annual cost of a loan may include fees, insurance, and taxes; this tool performs an interest-rate conversion only.

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