Simple Interest Calculator

Introduction

Simple interest grows in a straight line with time. Use this calculator for short-term loans, deposits, or educational estimates where interest is not compounded.

Disclaimer: This tool is for informational purposes only and is not professional medical, financial, or tax advice.

Formula

Simple interest is principal times annual rate times time in years, divided by 100. Maturity amount is principal plus interest.

• P — Principal
• R — Annual interest rate (%)
• T — Time in years
• I — Interest earned

Step-by-step

1. Enter the principal amount.
2. Enter the annual interest rate as a percent.
3. Enter the time period in years (decimals allowed).
4. Interest = principal × rate × time ÷ 100.

Worked example

At 8% for 2 years on $10,000, interest is $1,600 and the maturity amount is $11,600.

Use cases

• Estimate interest on a short-term personal loan
• Compare simple vs compound scenarios quickly
• Teach or check basic interest arithmetic

Frequently asked questions