Interest Calculator
Calculate simple interest: enter principal, annual rate and time in years.
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Simple Interest Formula
Interest = Principal × Rate × Time
Total = Principal + Interest
Example
$5,000 at 4% annual interest for 3 years:
- Interest = 5000 × 0.04 × 3 = $600
- Total = $5,600
Frequently Asked Questions
Multiply principal × annual rate × years. $5,000 at 4% for 3 years earns 5000 × 0.04 × 3 = $600.
Simple interest is paid only on the principal. Compound interest is also paid on accumulated interest, so it grows faster.
Yes — many auto loans, short-term personal loans and bonds use simple interest. Mortgages and credit cards typically compound.
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