Simple Interest Calculator
Simple interest is charged only on the original amount. Enter the principal, the yearly rate and the time.
Your details
Result
Interest earned
150.00
50.00 per year
- Final balance (principal + interest)
- 1,150.00
- Simple interest grows by the same amount every year. For interest on interest, use the compound interest calculator.
Good to know: $1,000 at 5% for 3 years earns $150, giving a balance of $1,150.
Please note: Illustrative estimate based only on the numbers you enter. This is not financial, investment, tax or legal advice and not an offer of any product. Real products have fees, rate changes and rules this tool does not model. Check figures with your lender or a qualified, independent adviser before you decide.
About this tool
Calculate simple interest — interest charged only on the original principal — plus the final balance and the interest earned per year.
Formula
interest = principal × rate ÷ 100 × time (years). Final balance = principal + interest.
Reference values
- Used for short-term loans and bonds
- Grows linearly, unlike compound interest
- Fractional years are supported
Questions people ask
What is the simple interest formula?
Interest = principal × rate × time.
How is it different from compound interest?
Compound interest is charged on interest as well, so it grows faster.
Where is simple interest used?
Some short-term loans, bonds and car finance agreements.
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How we calculate this
We use the standard published formula or definition for this calculation, and we show the working so you can check it.
Spotted a mistake? Tell us and we'll check it. How we check our calculators