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Savings Account Comparison Calculator

Enter the principal, years, and two APYs to compare the savings accounts.

How it is calculated

The same lump sum is grown at two annual percentage yields: value A = principal × (1 + APY1 ÷ 100)years and value B = principal × (1 + APY2 ÷ 100)years. The difference shown is value B − value A, so it is positive when account B pays more and negative when account A is the better one. APY already includes compounding, so the tool applies it once per year with no compounding frequency to choose. Years may be fractional. The tool models a single deposit: no monthly additions, fees, minimum balances or tax, and it assumes each rate stays unchanged for the whole period. All four fields are required and none can be negative; zero years or zero principal gives a difference of zero.

Worked example

You have 20000 to save for 5 years. Account A pays 0.5% APY and account B pays 4.5% APY. Step 1: A grows by 1.0055 = 1.025251, so value A = 20000 × 1.025251 = $20,505.03. Step 2: B grows by 1.0455 = 1.246182, so value B = $24,923.64. Step 3: difference = 24923.64 − 20505.03 = $4,418.61 in B's favour. Swapping the two rates flips the sign to a negative difference rather than hiding it.

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Common mistakes

  • Mixing up which rate goes in A and which in B. The difference is always B minus A, so putting the better account first shows a negative number.
  • Entering a nominal rate (APR) for one account and an APY for the other. Compare like with like, or the gap will be misstated.
  • Comparing a promotional rate that lasts a few months as if it held for all five years. The tool applies each rate for the full term.
  • Typing the rates as fractions (0.045). The fields are in percent, so 4.5.
  • Ignoring fees, minimum balances and tax. None are included, so a small gap can disappear once an account charges a monthly fee.

About this calculator

The annual percentage yield (APY) reflects the real annual return on a savings account including the effect of compounding, so even a small difference in APY between two banks compounds into a meaningfully different balance over time. Future value under compounding is calculated as FV = P x (1 + APY)^t, where P is the principal and t is the number of years.

Online banks and promotional accounts often advertise APYs well above the national average, and this calculator makes the gap concrete: enter a principal, a number of years, and two different APYs, and it computes the future value under each rate along with the extra earnings the higher-yield account produces — a practical way to decide whether switching banks or chasing a promotional rate is worth it.

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