Simple Interest Calculator
Calculate simple interest on a principal amount over a set period — no compounding.
How It Works
Uses the formula I = P x r x t where P is the principal, r is the annual rate as a decimal, and t is the time in years. For months, divides by 12; for days, divides by 365. Returns total interest earned and the final total (principal + interest).
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Frequently Asked Questions
What is simple interest?
Simple interest is calculated only on the original principal, not on accumulated interest. The formula is I = P x R x T, where P is principal, R is rate (as decimal), and T is time in years.
Where is simple interest used?
Simple interest is used for some personal loans, car loans, and short-term lending. Most savings accounts and home loans use compound interest instead.
What is the difference between simple and compound interest?
Simple interest is calculated only on the original principal. Compound interest is calculated on the principal plus any previously earned interest. Over time, compound interest grows much faster.
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