Simple Interest Calculator

Enter a principal amount, annual interest rate and term in years to calculate simple interest.

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Formula

Interest = (Principal × Rate × Years) ÷ 100

Example

A principal of 1,000 at 5% for 3 years earns 150 in interest, for a total of 1,150.

Frequently Asked Questions

How is simple interest different from compound interest?
Simple interest is calculated only on the original principal for the entire term, while compound interest is calculated on the principal plus any interest already earned.