Financial Calculators
Simple Interest Calculator
Calculate simple interest earned or owed on a principal amount at a fixed annual rate over a number of years.
Quick guide
Enter a principal, an annual rate, and the number of years to calculate simple interest. Interest is charged only on the original amount, so it grows by the same sum every year; the result shows the interest and the final balance.
Read the full explanationHow It Works
Simple interest grows linearly: the same amount of interest is added every period because it is calculated only on the original principal, never on accumulated interest.
Formula Used
I = P · r · t, where r is the annual rate as a decimal and t is time in years.
Example Calculation
$5,000 at 6% simple interest for 3 years earns $900, for a final balance of $5,900.
Practical Use Cases
- Estimate returns on simple-interest notes and bonds.
- Understand interest on short-term informal loans.
- Contrast simple interest with compound growth.