How to Calculate the Annual Percentage Yield on an IRA Account

IRA investments can grow exponentially.

IRA investments can grow exponentially.

Your individual retirement account's current balance and the size of your contributions reveal the account's to-date growth rate. This annual percentage yield does not necessarily indicate the account's future growth rate, but it does help you compare your investment choice with other alternatives, such as bonds or mutual funds. Though you can't calculate the account's APR with a direct formula, you can with a financial calculator and the relevant financial data.

Type your annual IRA contribution into your calculator, and then press "PMT." For example, if you have contributed $3,000 each year, enter "3000."

Type the number of years that you have contributed to the IRA, and then press "n." For example, if you have contributed for five years, enter "5."

Type "0" to represent the account's initial balance, and then press "PV."

Enter the account's current balance, and then press "FV." For example, if you have accumulated $17,200, type "$17,200."

Press "Compute" and press "i" to find the account's APR. With this example, the calculator reveals an annual percentage yield of 6.85 percent.

Items you will need

  • Financial calculator

About the Author

Ryan Menezes is a professional writer and blogger. He has a Bachelor of Science in journalism from Boston University and has written for the American Civil Liberties Union, the marketing firm InSegment and the project management service Assembla. He is also a member of Mensa and the American Parliamentary Debate Association.

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