📈 Interest Calculator
Simple interest is the most straightforward kind: the interest is always calculated on the original principal, never on previously earned interest. It shows up in some short-term loans, car title loans and basic savings estimates.
The formula is interest = principal × rate × time. If your bank compounds interest instead, use the compound interest calculator for the accurate figure.
How to use this calculator
Give the principal, the annual rate and the number of years to find the simple interest earned or owed, plus the total of principal plus interest.
- Enter the Principal amount of money involved.
- Type the Annual interest rate as a percentage.
- Set the Time in years (quarter-year steps are allowed).
- Press Calculate to see the interest figure and the combined total.
Frequently asked questions
What does simple interest mean?
Simple interest is charged or paid only on the original principal, never on interest that has already accrued. That makes it easy to predict: the interest grows by the same amount every year.
Which formula is used?
Interest equals principal times rate times time. A $10,000 principal at 5% for 3 years gives $10,000 x 0.05 x 3 = $1,500 of interest, and the total is principal plus interest.
When would I use simple interest instead of compound?
Use it for short-term loans, car title loans and back-of-envelope savings estimates that quote a flat rate. If your bank compounds the interest, switch to the compound interest calculator for the true figure.
How accurate is the result?
It is exact for true simple-interest arrangements. In practice many loans and savings products compound, so always check whether your contract says simple or compound interest before relying on the number.