Simple Interest Calculator

Quickly work out simple interest and the total amount to be repaid or received. Enter the principal, annual interest rate and time period to see the interest earned and final amount.

Helpful for comparing loans, savings products and basic interest scenarios where interest is not compounded.

Inputs
The amount you borrow or invest at the start.
%
Simple annual rate (no compounding).
Length of the loan or investment.
Converted to years internally for the calculation.
Used for display formatting only.
Controls how amounts and percentages are displayed.

Simple interest results

Total amount with simple interest
—

Principal

—
Initial amount you invest or borrow.

Interest earned / paid

—
Simple interest over the whole period.

Total amount

—
Principal plus simple interest.

Effective interest over period

—
Interest as % of principal for this time.

Summary of your calculation

Enter a principal amount, annual rate and time period to see the simple interest and total amount. Results will appear here.

  • Principal: —
  • Annual rate: —
  • Time: —
Principal vs total amount
Principal Total amount

How this simple interest calculator works

Simple interest is calculated only on the original principal and does not compound. That makes the math straightforward and easy to check by hand.

The core formula is: 

I = P × r × t

where:
  P = principal (initial amount)
  r = annual interest rate (as a decimal, e.g. 5% → 0.05)
  t = time in years

The total amount at the end of the period is: 

A = P + I
  = P × (1 + r × t)

If you enter months or days, the calculator converts them to years assuming 12 months per year or 365 days per year and then applies the same formula.

Example: simple interest on a loan

Suppose you borrow $1,000 at a simple interest rate of 5% per year for 3 years.

  • P = 1,000
  • r = 0.05
  • t = 3

Simple interest: 

I = P × r × t
  = 1,000 × 0.05 × 3
  = 150

Total amount to repay at the end: 

A = P + I
  = 1,000 + 150
  = 1,150

Simple interest vs. compound interest

  • Simple interest grows in a straight line: the same amount of interest accrues each year because it is always based on the original principal.
  • Compound interest grows faster over time because interest is periodically added to the principal, and future interest is calculated on this larger amount.
  • Simple interest is easier to understand and is often used for short-term loans or quick comparisons.

Frequently asked questions

Is simple interest better than compound interest?

It depends on which side you are on. As a borrower, simple interest is usually cheaper than compound interest for the same nominal rate and time. As an investor, compound interest is usually better because your money can grow faster.

What if the interest is charged for only part of a year?

Simple interest is proportional to time. For example, 6 months at 8% per year is 0.5 × 8% = 4% of the principal. This calculator handles months and days by converting them to a fraction of a year.

Does this calculator include fees or taxes?

No. It only applies the simple interest formula to the inputs you provide. Fees, charges and taxes would need to be added separately if they apply.