Average Interest Rate Over Time Calculator

Use our Average Interest Rate Over Time Calculator to sum up a rate that changed over time in one average annual rate. Enter each rate and how long it lasted — from one period to ten, in years and months — and it works out two averages, because they answer different questions.

The time-weighted average weights each rate by how long it lasted: 2% for 6 months and 6% for 18 months average 5.00% a year. The compound-equivalent average is the single steady rate that gives the same total growth when interest earns interest — here 4.99%, with 10.22% growth over the two years.

The compound-equivalent rate is never higher, and the gap widens as rates swing: losing 50% one year and gaining 100% the next averages 25% a year, yet you end where you started — a compound-equivalent rate of 0%. Rates can be negative, and the order of the periods doesn’t change either average.

Add a starting balance to see what it grows to — $10,000 at 3% for a year and then 5% for a year becomes $10,815 — and how each period changed it. Each rate is a yearly rate, nothing is added or taken out, and fees and taxes aren’t included, so treat the results as an estimate. To grow a balance through changing rates compounded monthly or daily, use our Variable Interest Rate Compound Calculator.