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The rate field below is a nominal annual rate, which this page divides by the compounding frequency. The number your bank advertises is an annual percentage yield, which already has the compounding in it. Type one where the other belongs and ten years on $10,000 comes out $181.15 too high, with nothing on screen to suggest anything is wrong.
Last updated 1 October 2026
Educational estimate only — not financial advice. Fees and taxes not included.
An educational estimate, not financial, investment or tax advice. This page applies one unchanging nominal rate to a balance, with an optional deposit at the end of each compounding period. It models no tax, no fee, no inflation, no withdrawal, no rate change and no risk of loss, and it cannot tell whether the percentage you typed was an interest rate or an annual percentage yield. Every federal rule quoted below carries its citation; check your own figures against the account disclosure your institution is required to give you.
A bank advertising a savings account shows you one figure, and federal law decides which one. Regulation DD, implementing the Truth in Savings Act, is unusually direct about it at 12 CFR 1030.8(b):
“If an advertisement states a rate of return, it shall state the rate as an ‘annual percentage yield’ using that term. (The abbreviation ‘APY’ may be used provided the term ‘annual percentage yield’ is stated at least once in the advertisement.) The advertisement shall not state any other rate, except that the ‘interest rate,’ using that term, may be stated in conjunction with, but not more conspicuously than, the annual percentage yield to which it relates.”
So the big number is the APY. And the APY is defined, at 12 CFR 1030.2(c), as “a percentage rate reflecting the total amount of interest paid on an account, based on the interest rate and the frequency of compounding for a 365-day period”. Read that definition against the field above labelled Annual rate (%). The field is a nominal rate: the page takes it, divides by the compounding frequency you select, and applies the result once per period. The APY is the answer to that process, not an input to it.
Put an APY in there and the compounding happens twice. The consequence is a real number:
$10,000 · a 5.00% APY account · monthly compounding
It is not a large error on a ten-year horizon, and that is precisely what makes it durable: nothing about the output looks wrong. There is no warning, because the page has no way to know which of two different quantities you typed into one field.
There are two correct moves and the second one is easier.
Convert the APY to a nominal rate. An APY of 5.00% corresponds to a different nominal rate at each frequency, and always a lower one, because more frequent compounding means less nominal rate is needed to reach the same yearly total:
A 5.00% APY, expressed as the nominal rate to enter here
Or select Annually and type the APY unchanged. This works because of what an APY is. It is already the whole year’s growth expressed as a single rate, so compounding it once a year reproduces the account exactly. Entering 5 with Annually selected returns $16,288.95 on $10,000 over ten years, which is the same figure the correct nominal rate gives at any frequency. The frequency selector becomes irrelevant the moment you are working in APY, which is the entire reason Regulation DD made institutions quote one.
Better still, do not convert anything. 12 CFR 1030.4(b) requires an account disclosure to carry “the ‘annual percentage yield’ and the ‘interest rate,’ using those terms”, and separately “the frequency with which interest is compounded and credited”. Every input this page needs is on a document the institution is obliged to give you, under labels the regulation fixes. The interest rate goes in the rate field; the compounding frequency goes in the selector.
The last row of the output is labelled Effective annual, and it is running the conversion in the other direction: it takes your nominal rate and frequency and reports the yield they produce. Regulation DD’s Appendix A gives the general formula for the same quantity:
APY = 100 [(1 + Interest/Principal)(365/Days in term) − 1]
with the instruction that for an account with no stated maturity, “such as a typical savings or transaction account”, the calculation uses “an assumed term of 365 days”, and that the institution shall “assume that all principal and interest remain on deposit for the entire term and that no other transactions (deposits or withdrawals) occur during the term”. Over a 365-day term the exponent is 1, so the formula collapses to the year’s interest divided by the principal, which is exactly what compounding a nominal rate n times produces. The appendix’s own first worked example: “If an institution pays $61.68 in interest for a 365-day year on $1,000 deposited into a NOW account… the annual percentage yield is 6.17%”.
At a 5% nominal rate, the row reads:
5% nominal, as a yield
Which is worth looking at for a moment, because it sizes something that gets oversold. The whole distance from annual to daily compounding at 5% is 12.67 basis points. On $10,000 over ten years that is the difference between $16,288.95 and $16,486.65: about $198, or roughly $1.65 a month. Compounding frequency is real and it is not where the money is. Half a percentage point of rate is worth more than any frequency change, which is why the regulation makes institutions compete on a single number that has already absorbed the frequency.
Two more things the regulation pins down about that figure, both useful when comparing two advertised accounts. Rounding: the APY “shall be rounded to the nearest one-hundredth of one percentage point (.01%) and expressed to two decimal places” (12 CFR 1030.3(f)(1)). Accuracy: it “will be considered accurate if not more than one-twentieth of one percentage point (.05%) above or below” the Appendix A figure (1030.3(f)(2)). A quoted 5.00% APY is therefore somewhere between 4.95% and 5.05%, and those two ends are $155.13 apart on $10,000 over ten years. Two accounts quoting the same APY to two decimals are not necessarily paying the same thing, and no calculator can resolve that; only the interest rate and the compounding frequency can.
The contribution field says Extra contribution / period ($), and it means exactly that: one contribution per compounding period, added at the end of it. The field is honest. It is also directly above a selector that can make a period one day long, and the two together produce a figure that looks like a mistake and is not.
$10,000 at 5% for 10 years, with $100 per period
Half a million dollars from $10,000 and “$100”, because “$100” was thirty-six and a half thousand a year. The Total contributions row in the output is the check: if it does not equal what you actually intend to deposit over the term, the frequency selector is wrong for your purpose. For a monthly saving habit, select Monthly (12) regardless of how your bank compounds, and accept the small inaccuracy in the compounding; it is far smaller than getting the deposit count wrong.
On ordering: the balance is grown first and the contribution is added afterwards, so the final deposit earns nothing. That is an ordinary end-of-period annuity and it understates a real savings habit slightly, since money paid in at the start of a month earns that month. The understatement is one period of interest on the whole balance: at a 5% nominal rate compounded monthly it is $64.70 on the $15,528.23 this page projects for $100 a month over ten years.
Whether you typed a rate or a yield. One field, two different quantities that both look like a percentage, and no way to tell them apart. This is the single largest source of error on the page and the reason the first section exists.
Tax. The figure is pre-tax, and the tax does not arrive at the end. The IRS: “Most interest that you receive or that is credited to an account that you can withdraw from without penalty is taxable income in the year it becomes available to you.” Interest on bank accounts, money market accounts and certificates of deposit is taxable in the year it is credited, reported on Form 1099-INT above $10, which means a taxable account compounds on the after-tax balance year after year and finishes lower than anything here.
That the rate will change. One rate, held for the whole term. A savings account rate is variable, and 12 CFR 1030.4(b)(1)(ii) requires an institution to disclose that the rate and the yield may change, how the rate is determined, and how often it may change. A ten-year projection from today’s rate is a statement about today, extended.
Fees. No field for one. A monthly maintenance fee comes out of the balance and compounds against you, and Regulation DD requires fees to be disclosed on the account document for that reason.
Inflation. Every figure is nominal. $16,288.95 in ten years is not $16,288.95 of today’s purchasing power, and nothing here deflates it.
Market risk, which is a different thing entirely. This models a rate applied to a balance. An investment return is a sequence of gains and losses whose order changes the result, and a negative year is not a smaller positive one. If you are modelling an investment rather than a deposit, the single most misleading thing about this page is how smooth the answer is.
Withdrawals, early-withdrawal penalties, and the term ending. No withdrawals, no penalty, and a certificate that matures mid-projection is not rolled over at whatever rate exists then.
Deposit insurance. FDIC: “Your deposits are automatically insured to at least $250,000 at each FDIC-insured bank.” The limit runs per depositor, per insured bank, per ownership category. This page applies no cap and does not know where the money is held.
The calendar. Daily compounding is 365 periods a year, with no leap day. The difference is immaterial at these rates, but it means the page’s “ten years” is 3,650 periods rather than 3,652 or 3,653.
Boundary behaviour worth knowing: a negative principal, rate, term or contribution is raised to zero, and the field above is rewritten to the value actually used when you leave it, so the screen does not hold a figure the answer was not computed from. A contribution is an addition only; this page has no way to model a withdrawal. A part-period earns nothing, because interest here is credited at the end of each period: half a year compounded annually earns no interest at all, and half a year of daily compounding is 182 completed days rather than 183. Two hard limits sit past that, both measured on 7 October 2026. More than 120,000 compounding periods is refused outright, which caps daily compounding at 328 years and monthly at 10,000. Below that ceiling the arithmetic can still run out of room: at 5% compounded annually a term of 14,359 years reports the future value as an infinity symbol, and quarterly it is 14,099 years. Monthly and daily compounding cannot reach the overflow at all, because the period limit refuses them first.
None of this is financial, tax or investment advice. It is a growth curve with its definitions sourced, and the definitions are the useful part.
Every regulation above was read at the eCFR on 1 October 2026 and quoted from the current text. Every figure on this page was computed independently of the calculator, at forty significant digits, and then checked against it; the effective-annual row and the future values agreed to the cent in every case tested. Nothing you type leaves your browser. Part of the QuikUtil tools collection; the Loan Calculator and Mortgage Payoff Calculator run the same arithmetic with the sign reversed, against a balance you are trying to get rid of.
No. That rate field is a nominal annual rate, which the page then divides by the compounding frequency. An APY already has the compounding inside it, so entering one compounds it twice. On $10,000 for ten years with monthly compounding, typing 5 when you hold a 5.00% APY returns $16,470.09 instead of $16,288.95: an overstatement of $181.15. Over thirty years it is $1,458.02. Use the “interest rate” from the account disclosure, which 12 CFR 1030.4(b)(1)(i) requires the institution to give you alongside the APY.
It depends on the compounding frequency, and the answer is always a little below 5%. Annually it is 5.0000%, quarterly 4.9089%, monthly 4.8889% and daily 4.8793%. The relationship is the one the Effective annual row on this page computes in reverse. You can skip the conversion entirely for a different reason: an APY is already an annual figure, so entering 5 with Annually selected gives the correct $16,288.95 for ten years on $10,000, which is the same answer as using the right nominal rate at any frequency.
Because the Truth in Savings Act requires it, and forbids them quoting much else. Regulation DD, 12 CFR 1030.8(b): “If an advertisement states a rate of return, it shall state the rate as an ‘annual percentage yield’ using that term… The advertisement shall not state any other rate, except that the ‘interest rate,’ using that term, may be stated in conjunction with, but not more conspicuously than, the annual percentage yield to which it relates.” The point is comparability: two accounts with the same APY pay the same over a year whatever their compounding frequency, which is exactly what a nominal rate cannot tell you.
It is the APY the rate and frequency you entered would produce, and it has a federal definition behind it. Regulation DD defines the annual percentage yield as “a percentage rate reflecting the total amount of interest paid on an account, based on the interest rate and the frequency of compounding for a 365-day period” (12 CFR 1030.2(c)). A 5% nominal rate becomes 5.0000% annually, 5.0945% quarterly, 5.1162% monthly and 5.1267% daily. Those are the figures the row shows, and the gap between the first and last, 12.67 basis points, is the entire economic value of compounding frequency at 5%.
Per compounding period, which is the selector immediately above it, not per month. The combination catches people out: with Daily (365) selected, $100 per period is $36,500 a year. Ten years of that on $10,000 at 5% returns $490,011.96, of which $365,000 is your own money. If you mean $100 a month, select Monthly (12), which gives $12,000 of contributions and a future value of $31,998.32.
After. Each period the balance is multiplied by one plus the periodic rate, and then the contribution is added, so the final contribution earns nothing at all. That is an ordinary end-of-period annuity, and it is the conservative choice. If you actually deposit at the start of each period, every contribution earns one more period than this models and the real figure is higher, by a factor of one plus the periodic rate.
Before. The IRS puts the timing plainly: “Most interest that you receive or that is credited to an account that you can withdraw from without penalty is taxable income in the year it becomes available to you.” Interest on bank accounts, money market accounts and certificates of deposit is in that category, and you should receive a Form 1099-INT if you were paid $10 or more. So the tax is not a deduction at the end of the term: it falls every year, on interest you may not have withdrawn, which is why a taxable account compounds more slowly than this page shows.
A savings account, and only a particularly simple one. It applies one unchanging rate for the whole term. A savings account rate is variable and the institution can change it, which 12 CFR 1030.4(b)(1)(ii) requires it to disclose up front. An investment return is not a rate at all; it is a sequence, and the order in which gains and losses arrive changes the outcome. Nothing on this page models risk, a loss, a fee or a withdrawal.
Closer than most people assume, and the rule is numerical. Regulation DD requires the APY to be “rounded to the nearest one-hundredth of one percentage point (.01%) and expressed to two decimal places”, and treats it as accurate “if not more than one-twentieth of one percentage point (.05%) above or below” the figure the Appendix A formula gives (12 CFR 1030.3(f)). So a quoted 5.00% APY means the real figure is between 4.95% and 5.05%, which on $10,000 over ten years puts the two ends $155.13 apart.
At an FDIC-insured bank, “your deposits are automatically insured to at least $250,000 at each FDIC-insured bank.” The limit applies per depositor, per insured bank, per ownership category, so one large balance at one bank is treated differently from the same money spread across institutions or across account types. This page does not know where the money is and applies no limit of any kind.
No. It is arithmetic with its sources named, and it cannot see your account, your rate, your tax position or your risk. Check the rate, the compounding frequency and the APY on your own account disclosure, which federal law requires the institution to give you.