Simple Interest Calculator
Calculate simple interest earned or owed on a principal amount over a given time at a fixed annual rate.
About this simple interest calculator
Simple interest is calculated only on the original principal, unlike compound interest, it does not grow on previously earned interest, common in short-term loans and some savings products.
How simple interest calculator works
The formula is: Simple Interest = (Principal × Rate × Time) ÷ 100. For example, $1,000 at 5% for 3 years earns (1000 × 5 × 3) ÷ 100 = $150.
Common uses
- Calculating interest on a short-term loan
- Checking interest owed on a fixed-rate agreement
- Comparing simple vs compound interest on the same amount
How to use this tool
- Enter the principal amount.
- Enter the annual interest rate.
- Enter the time period in years.
- See the interest and total repayment instantly.
What to know before using it
For interest that compounds over time, use the Compound Interest Calculator instead, which typically produces a higher return over the same period.
Privacy and browser-first processing
This tool runs entirely in your browser using JavaScript. Nothing you enter is uploaded or stored.
Frequently asked questions
What is the simple interest formula?
Simple Interest = (Principal × Rate × Time) ÷ 100, where rate is the annual percentage and time is in years.
How is simple interest different from compound interest?
Simple interest is calculated only on the original principal each year. Compound interest is calculated on the principal plus any interest already earned, so it grows faster over time.