Calculate simple interest on your savings or loans. Enter principal, rate, and time to see your interest earnings instantly.
Interest calculation for 5 years.
Breakdown choice
Table/chart
Year | Interest | Collective Interest | Amount |
|---|---|---|---|
| 0 | $0 | $0 | $5,000 |
| 1 | $400 | $400 | $5,400 |
| 2 | $400 | $800 | $5,800 |
| 3 | $400 | $1,200 | $6,200 |
| 4 | $400 | $1,600 | $6,600 |
| 5 | $400 | $2,000 | $7,000 |
Calculate simple interest quickly and accurately with our free online calculator. Whether you're planning savings, evaluating a loan, or understanding investment returns, our simple interest calculator provides instant results with a detailed breakdown.
With our calculator, you can:
Calculate total interest earned on your savings or investments
Determine the final maturity amount after a specified period
Add deposits and withdrawals to see how they affect your returns
View a month-by-month breakdown of your interest growth
Visualize results with interactive charts
Simple interest is a method of calculating interest where the interest is computed only on the original principal amount throughout the entire loan or investment period. Unlike compound interest, simple interest does not earn "interest on interest."
Simple interest is commonly used for:
The formula for calculating simple interest is straightforward:
SI = P × R × T
Where:
To find the total amount (A) after interest:
A = P + SI = P × (1 + R × T)
Let's say you deposit $10,000 in a savings account that pays 5% simple interest per year for 3 years.
SI = P × R × T
SI = $10,000 × 0.05 × 3
SI = $1,500
Total Amount = $10,000 + $1,500 = $11,500
After 3 years, you would earn $1,500 in interest, and your total balance would be $11,500.
| Feature | Simple Interest | Compound Interest |
|---|---|---|
| Interest Calculation | Only on principal | On principal + accumulated interest |
| Growth Pattern | Linear | Exponential |
| Total Returns | Lower | Higher |
| Best For | Short-term loans, simple savings | Long-term investments, savings |
For borrowers, simple interest is often more favorable as you pay less over time. For savers and investors, compound interest typically yields higher returns, especially over longer periods.
Simple interest is commonly applied in the following scenarios:
Auto Loans: Many car loans use simple interest calculated on the remaining balance
Personal Loans: Short-term personal loans often use simple interest
Certificates of Deposit: Some CDs pay simple interest rather than compound
Treasury Bills: Government securities often use simple interest calculations
Consumer Credit: Some store financing and installment plans use simple interest
To calculate monthly simple interest, divide the annual interest rate by 12. For example, if the annual rate is 6%, the monthly rate is 0.5% (6% ÷ 12). Then multiply: Principal × Monthly Rate.
It depends on your situation. As a borrower, simple interest is better because you pay less over time. As a saver or investor, compound interest is better because your money grows faster.
Yes! Our calculator allows you to add deposits and withdrawals at any point during the investment period to see how they affect your final balance and total interest earned.
With simple interest, withdrawing early reduces your principal, which means you'll earn less interest going forward. Our calculator lets you model withdrawals to see the impact.
Use our simple interest calculator above to plan your savings, compare loan options, or understand how your money grows over time. The calculator provides instant, accurate results with visual breakdowns to help you make informed financial decisions.
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