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Interest Calculator
Work out simple interest and the total amount after a number of years.
How this calculator works
Simple interest is calculated only on the original amount: principal times the yearly rate times the number of years. The result shows the interest earned or owed and the total you end up with. It does not compound, so interest never earns interest. Some car loans, short-term notes and certain bonds use simple interest, while savings accounts and credit cards usually compound.
Example
You deposit or borrow $5,000 at 4.5% simple interest for 3 years. The calculator shows: Interest: $675.00 · Total: $5,675.00. The interest is the same each year because it is always based on the $5,000 starting amount.
Tips
- Use this for loans and notes that state "simple interest." For savings that compound, use the Compound Interest Calculator instead.
- Convert months to years by dividing by 12 (for example, 18 months is 1.5 years).
- Compare the simple and compound results for the same rate to see how much compounding adds over time.
Common questions
What is the formula for simple interest?
Interest equals principal times rate times time, with the rate as a decimal and time in years.
Is simple interest better for a borrower?
Usually yes, because you pay interest only on the original balance, not on interest that has already built up. For a saver it is the reverse.
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Results are estimates only. See our disclaimer.