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Simple Interest Calculator

Work out simple interest from the principal, rate, and time, or solve for any one of the four. The simple interest calculator shows the formula with your own numbers.

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Interest
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Estimate only. Not financial advice.

How to use the Simple Interest Calculator

  1. Choose what to Solve for: Interest, Principal, Rate, or Time.
  2. Enter the other three values. The rate is a yearly percentage and the time is in years.
  3. Press Calculate. The answer appears with the formula and the total of principal plus interest.

How it works

I = P × r × t
P = I ÷ (r × t)
r = I ÷ (P × t)
t = I ÷ (P × r)
  • I: the interest earned or owed
  • P: the principal, the amount you start with
  • r: the yearly rate as a decimal (5% = 0.05)
  • t: the time in years (18 months = 1.5)

Examples

  • $10,000 at 5% for 3 years: 10,000 × 0.05 × 3 = $1,500 interest, $11,500 in total.
  • To earn $1,500 in 3 years at 5%, you need 1,500 ÷ (0.05 × 3) = $10,000.
  • $10,000 that earned $1,500 in 3 years grew at 1,500 ÷ (10,000 × 3) = 5% a year.

Simple versus compound interest

Simple interest is paid only on the original amount. Compound interest is also paid on interest already earned, so it grows faster. Over 10 years at 5%, $10,000 earns $5,000 in simple interest but $6,470 compounded monthly. Use the compound interest calculator for savings accounts and investments.

Limitations

  • Assumes no compounding and no deposits or withdrawals.
  • Rate and time must use the same unit: a yearly rate with years.
  • Some loans quoted as simple interest calculate it daily on the remaining balance, which this tool does not model.

Sources and method review

This page uses fixed-principal simple interest, I = P × r × t, with an annual decimal rate and time in years. The CFPB explains that simple-interest auto loans can calculate interest daily or monthly on the outstanding balance. That changing-balance loan method is not the same model as this fixed-principal calculator.

Technical content review: 27 October 2026. The documented method and assumptions were compared with the calculator code and the cited source. This is not a review by a licensed financial or tax adviser.

Frequently asked questions

What is the simple interest formula?

I = P × r × t: principal times the yearly rate times the number of years.

Where is simple interest used?

Some car loans, personal loans, bonds, and short-term notes use it. Most savings accounts compound instead.

How do I enter months?

Divide by 12. For example, 18 months is 1.5 years.

Often used together with Simple Interest Calculator.