Simple Interest Calculator
Interest on principal alone, no compounding.
Formula
I = P × r × t
P = $5,000, r = 5%, t = 3 years. Interest is computed only on the original principal, not on accrued interest.
Simple interest is rarer than compound interest in modern banking. You'll see it on most car loans, short-term personal loans, US Treasury bills under a year, and some bonds. For savings, CDs, and most investments, use compound interest.
About
Enter principal, annual rate, and time in years. Get the simple interest and the final balance. Used for most short-term loans, T-bills, and some bonds. For savings, CDs, and most investments, you want compound interest.
How to use
- Enter principal, rate, and time.
- Read interest and total.
FAQ
Simple or compound?+
Simple if your interest is calculated only on the original principal. Compound if interest gets added to principal and earns interest itself. Most modern bank products compound; this tool is for the cases that don't.