Simple Interest Calculator
Calculate simple interest on a loan or investment.
How to Do It Manually
Simple interest is calculated only on the original principal amount, not on interest earned.
Interest = P × r × t (P = principal, r = annual rate as decimal, t = time in years)
- Convert the annual rate to a decimal (divide by 100).
- Multiply principal × rate × time (in years).
- The result is the total interest earned or owed.
Frequently Asked Questions
What is the difference between simple and compound interest?
Simple interest is calculated only on the principal. Compound interest is calculated on the principal plus previously accumulated interest.
How do I calculate for months instead of years?
Express time as a fraction of a year. 6 months = 0.5 years, 3 months = 0.25 years.