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Simple interest calculator

Calculate simple interest (I = P × r × t) and the maturity amount on a principal for a term in years, months or days.

Updated Checked against 5 worked examples

$
%
Try
Interest
$
Interest: $1,800.00
Shown to 2 decimal places, half-even
Total amount
$11,800.00
Interest per year
$600.00
Amount if compounded yearly
$11,910.16

At 6% simple interest, $10,000.00 earns $600.00 a year, so $1,800.00 over the term. Compounding yearly at the same rate would give $110.16 more.

Amount at maturity

$11.8Kat maturity
Principal84.7%Interest15.3%

Balance over time

$10K$10.5K$11K$11.5K0123Years
Simple interestCompounded yearly
Interest by year (3 rows)
PeriodInterest in periodInterest so farBalance
Year 1$600.00$600.00$10,600.00
Year 2$600.00$1,200.00$11,200.00
Year 3$600.00$1,800.00$11,800.00
How it's calculated S

  1. Time in years

    t=3=3t = 3 = 3

  2. Interest

    I=Prt=10,000.00×0.06×3=1,800.00I = P r t = 10{,}000.00 \times 0.06 \times 3 = 1{,}800.00

  3. Total amount

    A=P+I=10,000.00+1,800.00=11,800.00A = P + I = 10{,}000.00 + 1{,}800.00 = 11{,}800.00

    Rounded half-to-even to 2 decimals for display only.

About the simple interest calculator

Simple interest is paid only on the original principal: I = P × r × t, where r is the yearly rate as a decimal and t the time in years. A term in months is divided by 12, and a term in days by 365 (actual/365) or by 360, the banker's year some lenders and money markets use. The amount due at maturity is A = P(1 + rt).

With the defaults, 10,000 at 6% for 3 years earns 600 a year and 1,800 in total, for a maturity amount of 11,800. Compounded yearly at the same rate, the same deposit would reach 11,910.16, which is 110.16 more.

Interest here never earns interest of its own. Savings accounts and most deposits compound, so use the compound interest calculator for them; simple interest suits short loans, flat-rate quotes and interest accrued between coupon dates.

Worked examples

10,000 at 6% for 3 years

Principal
10,000
Interest rate (per year)
6%
Time
3
Time in
Years
Interest
1,800.00
Total amount
11,800.00
Amount if compounded yearly
11,910.16

Checked against: 10000 × 0.06 × 3 by hand; 10000 × 1.06³ = 11910.16 (Python decimal)

5,000 at 8% for 9 months

Principal
5000
Interest rate (per year)
8%
Time
9
Time in
Months
Interest
300.00
Total amount
5,300.00

Checked against: 5000 × 0.08 × 9/12 by hand

20,000 at 7.5% for 90 days, actual/365

Principal
20,000
Interest rate (per year)
7.5%
Time
90
Time in
Days
Days in a year
365 (actual/365)
Interest
369.86

Checked against: 20000 × 0.075 × 90/365 = 369.8630… (Python decimal)

Same loan on a 360-day year

Principal
20,000
Interest rate (per year)
7.5%
Time
90
Time in
Days
Days in a year
360 (banker's year)
Interest
375.00

Checked against: 20000 × 0.075 × 90/360 by hand

Questions

How do you calculate simple interest?

Multiply the principal by the yearly rate and by the time in years: I = P × r × t. 10,000 at 6% for 3 years earns 10,000 × 0.06 × 3 = 1,800, so 11,800 is repaid. For a term in months, divide by 12 first: 5,000 at 8% for 9 months earns 5,000 × 0.08 × 9/12 = 300.

How do you calculate simple interest for a number of days?

Divide the days by the day-count basis before multiplying. 20,000 at 7.5% for 90 days earns 20,000 × 0.075 × 90/365 = 369.86 on an actual/365 basis, and 375.00 on a 360-day banker's year. Excel's ACCRINTM function uses basis 3 for actual/365 and basis 2 for actual/360.

How do you find the rate or the time from simple interest?

Rearrange I = P × r × t. The rate is r = I ÷ (P × t): earning 1,800 on 10,000 over 3 years means 1,800 ÷ 30,000 = 6% a year. The time is t = I ÷ (P × r): earning 3,000 on 10,000 at 6% takes 3,000 ÷ 600 = 5 years.

Is simple interest better than compound interest?

For a borrower, yes; for a saver, no. Simple interest grows in a straight line, while compound interest also earns interest on interest. On 10,000 at 6%, the gap is only 110.16 after 3 years (1,800 against 1,910.16), but after 20 years simple interest totals 12,000 while yearly compounding adds 22,071.35.

How accurate is the simple interest calculator?

Accuracy depends on your inputs and the method's assumptions. Decimal arithmetic uses 50 significant digits, but estimates, numerical methods and source data can be less precise; the displayed rounding does not remove those limits. It is checked against 5 worked examples whose answers come from independent sources; for example, “10,000 at 6% for 3 years” is checked against 10000 × 0.06 × 3 by hand; 10000 × 1.06³ = 11910.16 (Python decimal).

Where does the method come from?

OpenStax Prealgebra 2e — Simple Interest Applications (I = Prt); Brealey, Myers & Allen — Principles of Corporate Finance, ch. 2 (simple vs compound interest); Microsoft Excel ACCRINTM function (simple interest accrued to maturity, basis 2 = actual/360, 3 = actual/365).

About this calculator

I=P⋅r⋅t,A=P(1+rt)I = P \cdot r \cdot t,\qquad A = P(1 + r t)

Sources

  1. OpenStax Prealgebra 2e — Simple Interest Applications (I = Prt)
  2. Brealey, Myers & Allen — Principles of Corporate Finance, ch. 2 (simple vs compound interest)
  3. Microsoft Excel ACCRINTM function (simple interest accrued to maturity, basis 2 = actual/360, 3 = actual/365)

For planning only. Lenders, tax authorities and markets apply their own rounding, fees and rules; confirm figures with them before you commit.

Checked against references

5 worked examples with independently sourced answers ship with this calculator. They run in the test suite; you can run them here too.

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