Simple Interest Calculator
Work out simple interest on a loan or deposit. Enter the principal, an annual rate and how many years and see the interest and final amount instantly. Time can be fractional, like 2.5 years.
How to use the simple interest calculator
- Enter the principal, the amount you invest or borrow.
- Set the annual interest rate and the time in years.
- Read off the interest earned and the total amount due.
Examples
1,000 at 10% for 2 years
principal 1000, rate 10%, time 2 years
interest 200, total amount 1,200
Frequently asked questions
What is the simple interest formula?
Simple interest is I = P x R x T, where P is the principal, R is the annual rate as a decimal and T is the time in years. The total amount is principal plus interest.
How is simple interest different from compound interest?
Simple interest is charged only on the original principal, so it stays the same each year. Compound interest is charged on the principal plus any interest already added, so it grows faster over time.
When is simple interest actually used?
It is common for short-term and car loans, some personal loans, treasury bills and many fixed deposits where interest is paid out rather than reinvested.
Can I use fractional years or months?
Yes. Enter the time as a decimal, for example 0.5 for six months or 2.5 for two and a half years. The interest scales linearly with time.
Does this tool send my numbers anywhere?
No. The calculation runs entirely in your browser, so the figures you type never leave your device.
How do I find the rate or principal from the interest?
Rearrange the formula: rate R = I / (P x T) and principal P = I / (R x T). Plug in the values you know to solve for the missing one.
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