About this Simple Interest Calculator
Simple Interest Calculator estimates interest when the same original principal is used throughout the calculation. This differs from compound interest, where interest can itself earn interest.
Formula or method
Simple interest = principal × annual rate × time.
Example
1,000 at 5% simple interest for 2 years earns 100, for a final amount of 1,100.
Common uses
- Check classroom or textbook simple-interest examples.
- Estimate non-compounding interest over a stated period.
- Compare simple-interest scenarios with different rates or durations.
How to use this tool
- Enter the values or text requested by the calculator.
- Choose units or options when the tool provides them.
- Select the calculation button and review the result.
- Use the formula, example and notes on this page to check whether the result fits your situation.
Important note
Simple interest does not add prior interest to the principal for later periods.
Estimate only: Money-related results are mathematical estimates. They are not financial, tax, legal, credit or lending advice.
Frequently asked questions
Is this compound interest?
No. The calculation uses the original principal for the full period.
How should I enter 5%?
Enter 5 in the annual rate field; the tool converts it to 0.05 internally.