Simple Interest Calculator: Principal, Rate & Total
Calculate simple interest on loans or investments: enter principal, annual rate, and months to get the exact interest and total.
Interest earned
500 €
Total (principal + interest)
10.500 €
Simple interest: always calculated on the initial principal, never on accumulated interest.
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Frequently asked questions
How do you calculate simple interest?
Use the formula I = P × r × t. In this calculator, enter principal, annual rate, and months. It divides the annual rate by 12, multiplies by months, and adds the interest to the principal to show the total.
What is the difference between simple interest and compound interest?
Simple interest is calculated only on the original principal, so interest does not earn more interest. Compound interest is calculated on the principal plus previously accumulated interest, which can grow faster over time.
Is simple interest used for loans or investments?
Both. Many personal loans, car loans, and short-term loans use simple interest. It is also common for savings accounts, certificates of deposit, and other fixed-income investments.
What Is Simple Interest?
Simple interest is a quick way to calculate the charge on a loan or the earnings on an investment. It is based only on the original principal, unlike compound interest. This makes it easy to budget and compare financial products.
How to Use the Simple Interest Calculator
Enter the principal amount, choose the annual interest rate, and enter the time in months. The calculator will instantly show the interest and the total amount you will pay or earn. Use it for loans, savings, or any fixed-rate financial plan.
Simple Interest Formula and Examples
The formula is simple: I = P × r × t, where P is the principal, r is the annual interest rate in decimal form, and t is time in years. For monthly calculations, divide the annual rate by 12. Example: $1,000 at 6% annual interest for 12 months earns $60.