Simple Interest Calculator
A simple interest calculator finds the interest earned or owed on a principal amount using a fixed annual rate applied once per year, without compounding. Toolverge’s Compound Interest Calculator covers interest that reinvests each period; this tool is for the flat-rate case used by many short-term loans, car loans, and some bonds.
Educational estimate only. Results are not medical, legal, or financial advice. Confirm important decisions with a qualified professional.
How it works
- Enter the principal amount.
- Enter the annual interest rate as a percent.
- Enter the time in years — read the interest and total on the tape.
Formula Interest = Principal × Rate × Time / 100; Total = Principal + Interest
Frequently asked questions
What is the simple interest formula?
I = P × r × t / 100, where P is principal, r is the annual rate as a percent, and t is time in years.
How is this different from compound interest?
Simple interest is calculated only on the original principal every period. Compound interest is calculated on the principal plus any interest already added, so it grows faster over time — use the Compound Interest Calculator for that case.
Can I use months instead of years?
Yes — enter time as a fraction of a year, e.g. 6 months = 0.5.
Does this account for extra payments or fees?
No — it’s the pure formula. Real loans may add fees or amortize differently; check your lender’s disclosure.
Is this financial advice?
No — it’s an estimate based on the formula. Confirm terms with your lender or bank.