Simple Interest Calculator
Quickly compute the simple interest for your loans or investments.
Simple Interest Calculator
Enter details to see the calculation.
What is Simple Interest?
Simple interest is a straightforward method of calculating the interest charge on a loan or investment. It is determined by multiplying the daily interest rate by the principal by the number of days that elapse between payments.
Unlike compound interest, simple interest is only calculated on the original principal amount. This means you don't earn interest on the interest you've already accumulated, making the growth linear rather than exponential.
The Formula for Simple Interest
The formula to calculate simple interest is:
I = P × r × t
- I = The total interest earned
- P = The principal amount (the initial sum of money)
- r = The annual interest rate (in decimal form)
- t = The time period in years
The total amount (A) to be repaid is the principal plus the interest: A = P + I.