Simple Interest Calculator

1. 01Enter the principalThe original amount of money (the loan or investment amount).
2. 02Enter the annual interest rateAs a percentage per year, for example 5 for 5%.
3. 03Enter the time periodIn years — use a decimal for part of a year, for example 0.5 for six months.

• Short-term loansMany short-term and personal loans use simple interest, calculated only on the original amount borrowed.
• Comparing to compound interestSee exactly how much less simple interest earns compared to compound interest over the same rate and period, since simple interest never compounds.
• Coursework and finance basicsCheck simple interest homework problems, or build intuition for how the formula works before moving on to compound interest.

• A 3-year loan$1,000 principal at 5% annual simple interest for 3 years: interest = 1000 × 0.05 × 3 = $150. Total = $1,150.
• A 6-month period$1,000 principal at 6% annual simple interest for 0.5 years: interest = 1000 × 0.06 × 0.5 = $30. Total = $1,030.

Interest = Principal × Rate × Time, where rate is the annual interest rate as a decimal and time is in years. The total amount is the principal plus the interest. Because it only applies to the original principal, simple interest grows linearly (a straight line) over time, rather than the accelerating curve of compound interest.

Simple interest calculates interest only on the original principal for the entire period. Compound interest calculates interest on the principal plus any interest already earned, so it grows faster the longer the money is invested or owed. Most savings accounts, mortgages, and long-term investments use compound interest — simple interest is more common for short-term loans and certain bonds.

Enter a principal above 0, an annual rate of 0% or more, and a time period above 0 years (decimals allowed for partial years). The calculator returns the interest amount and the total (principal plus interest).

What is the simple interest formula?

Interest = Principal × Rate × Time, where the rate is the annual interest rate (as a decimal) and time is in years.

What is the difference between simple and compound interest?

Simple interest is calculated only on the original principal for the whole period. Compound interest is calculated on the principal plus previously earned interest, so it grows faster over time. For compounding, see the compound interest calculator.

Can I use a fractional number of years?

Yes. Use a decimal, for example 0.5 for six months or 2.25 for 2 years and 3 months.

Does this account for extra payments or changing rates?

No. This calculates simple interest for a fixed principal, fixed rate, and fixed time period only — it does not account for partial payments, rate changes, or fees.

Is my data saved?

No. Everything is calculated in your browser; nothing is sent to a server.