New comparison page
Daily vs Monthly Compounding: Does It Make a Big Difference?
This page was added because the site already had frequency intent, but it lacked one important comparison landing page. Daily compounding sounds dramatically better than monthly compounding. In practice, the gap is often much smaller than the language suggests.
Short answer
Daily compounding usually beats monthly compounding slightly, not massively, when the same nominal annual rate is used.
The difference gets more visible over long periods and larger balances, but it often stays smaller than the impact of time, fees or contribution size.
Why the gap is small
By the time you are already compounding monthly, you are already crediting interest fairly often. Moving from 12 compounding events a year to 365 does improve the ending balance, but not in a dramatic way for most ordinary scenarios.