Effective vs. nominal annual interest calculator

 

Useful information about the effective vs. nominal annual interest calculator on moneyland.ch

  • The calculator lets you quickly and easily convert an effective annual interest rate into a nominal annual interest rate and vice versa.
  • Because interest compounding intervals influence calculations of effective annual interest rates, the calculator can be used to compare two investments with different interest compounding intervals. This type of comparison can only be performed using effective annual interest rates (not nominal interest rates).
  • The effective annual interest rate is an indicator of the actual interest paid out on an investment over one year. This is the interest rate used to calculate Swiss personal loans and for many other purposes.
  • The nominal annual interest rate does not account for interest paid out or charged at intervals shorter than one year. The effective annual interest rate accounts for this interest.
  • Results are calculated in full and rounded to the fifth decimal.

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