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Simple Interest Calculator

Calculate simple interest on loans or investments. Simple interest is calculated only on the principal amount.

Loan/Investment Details

About Simple Interest

Simple interest is calculated only on the principal amount. Unlike compound interest, it does not account for interest on accumulated interest.

Formula: I = P × r × t

Where:
  • I = Interest amount
  • P = Principal (initial amount)
  • r = Annual interest rate (decimal)
  • t = Time in years

Simple vs. Compound Interest

Simple Interest

  • Calculated only on principal
  • Interest amount stays constant each period
  • Lower returns for investors
  • Lower cost for borrowers

Compound Interest

  • Calculated on principal + accumulated interest
  • Interest amount grows each period
  • Higher returns for investors
  • Higher cost for borrowers

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