Finance tools
Simple interest calculator
Free simple interest formula calculator using I = Prt. Estimate loan interest, monthly simple interest, or end balance — solve for principal, rate, time, or balance with worked steps, chart, schedule, and CSV or PDF export.
What is simple interest?
Simple interest is interest calculated only on the original principal — not on interest you have already earned. Each period, the interest amount stays the same because the base balance never grows.
That makes simple interest easy to estimate for short-term loans, bond coupons, promissory notes, and classroom math. It differs from compound interest, where earned interest is added to the balance and future interest is calculated on the larger amount.
Who uses this calculator?
Personal loans, flat-rate savings illustrations, homework problems, and quick loan-interest estimates — always pre-tax and without fees unless you adjust the rate manually.
Simple interest formula
Standard formulas
I = P × r × tA = P(1 + rt)I = interest · P = principal · r = annual rate (decimal) · t = time in years · A = end balance
Same formula as I = Prt — the form most textbooks and featured snippets use.
To calculate simple interest step by step:
- Convert the annual rate — divide your annual percentage by 100 (3% → 0.03).
- Express time in years — divide months by 12 or days by 365 (or 360 for some commercial loans).
- Multiply and add — interest = P × r × t; end balance = principal + interest.
Worked example ($20,000 at 3% for 10 years)
I = 20,000 × 0.03 × 10 = $6,000. End balance = 20,000 + 6,000 = $26,000.
I = Prn (rate per period)
When your rate is quoted per month (not per year), use I = P × r × n where n is the number of periods.
Example: $10,000 at 0.5% per month for 12 months → I = 10,000 × 0.005 × 12 = $600. This calculator accepts an annual rate; divide a monthly rate by 12 or enter months in the term field.
Simple interest calculation examples
$1,000 at 5% for 3 years
I = 1,000 × 0.05 × 3 = $150. End balance = $1,150 — a common homework and PAA example.
$10,000 at 5% for 5 years
I = 10,000 × 0.05 × 5 = $2,500. Total repayment = $12,500 — typical loan illustration.
$10,000 at 4% for 1–2 years
One year: $400 interest. Two years: $800 — flat annual interest on the original $10,000 only.
Simple vs compound interest
Simple interest
$10,000 at 5% for one year → $500 every year on the original $10,000 only. Over five years: $2,500 total interest.
Compound interest
Same 5% compounded monthly on a five-year loan → about $2,834 in interest — interest also earns interest.
When it matters
Long horizons and reinvested savings favor compound math. Short flat-rate loans and bonds often use simple interest.
For long-term savings with compounding, use our compound interest calculator or APY calculator for high-yield savings accounts. Searching for a simple vs compound interest calculator? Run both tools with the same inputs to compare flat vs compounding growth.
When is simple interest used?
Simple interest appears on some short-term car notes, bond coupons, Treasury prompt-payment estimates, and early-payment discounts where interest does not compound on prior interest.
Most consumer credit cards, mortgages, and savings accounts use compound interest instead. If your lender amortizes principal over time, use an auto loan calculator or amortization schedule calculator.
Simple interest calculator monthly
Annual simple interest divided by 12 gives a flat monthly interest line when the principal stays constant — this answers how to calculate interest rate per month on a simple-interest basis:
Monthly interest = P × (annual rate / 100) / 12
Example: $30,000 at 6% → $1,800 per year → $150 per month on average.
Example: $10,000 at 6% → $50 per month ($600 per year). For one month only, multiply principal by the monthly rate: 1% per month on a flat balance equals 12% per year in total simple interest — not the same as compounded monthly APY.
Use the calculator’s months term unit for partial-year periods.
Simple interest on a loan
A simple interest loan calculator estimates total interest when the rate applies to a fixed principal for a set term — useful for promissory notes or flat-rate illustrations. Many auto loans are simple interest on a declining balance, but monthly payments are amortized, so the interest portion changes each month.
This tool models flat simple interest on a constant principal. For payment amounts and declining balances, use our auto loan calculator or amortization schedule calculator.
Date-range loans: enter the loan length in days, months, or years rather than picking calendar start/end dates. A dedicated “between two dates” mode is not in v1.
How to use this calculator
Pick what to solve
Choose End balance, Principal, Interest rate, or Time period.
Enter the known values
Fill in principal, rate, and term — or end balance when solving backward.
Read the results
Review total interest, worked steps, yearly schedule, and export CSV/PDF if needed.
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Frequently asked questions about this simple interest calculator
What is the simple interest formula?
I = P × r × t where P is principal, r is the annual rate as a decimal, and t is time in years. End balance: A = P(1 + rt). Written compactly: I = Prt.
How do you calculate simple interest?
Multiply principal by the annual rate (as a decimal) by time in years. Example: $1,000 × 0.05 × 3 = $150 interest. Add interest to principal for the end balance.
What is the simple interest on $1,000 at 5% for 3 years?
Interest = 1,000 × 0.05 × 3 = $150. End balance = $1,150.
What is 6% interest on $10,000?
Annual simple interest = 10,000 × 0.06 = $600 per year. Average monthly simple interest ≈ $50 when principal stays flat.
What is 6% simple interest on $30,000 per year?
Annual interest = 30,000 × 0.06 = $1,800. Average monthly simple interest ≈ $150 when principal stays flat.
What is 5% simple interest on $50,000 per year?
Annual interest = 50,000 × 0.05 = $2,500. Over five years at a flat rate: $12,500 total interest on the original principal.
What is the difference between simple and compound interest?
Simple interest is paid only on the original principal. Compound interest is paid on principal plus accumulated interest. See our compound interest calculator for growth with compounding.
How do you calculate simple interest per month?
Divide annual simple interest by 12: Monthly = P × (rate / 100) / 12. Example: $10,000 at 6% → $50/month. This assumes the principal does not change month to month.
Can I calculate simple interest between two dates?
This calculator uses a term length in years, months, or days — not calendar start/end dates. Count the days between dates and enter that number with the Days unit (365- or 360-day year in Advanced). For amortized loans with payment dates, use our amortization schedule calculator.
Can this calculator solve for principal, rate, or time?
Yes. Use the mode tabs to solve for end balance, principal, interest rate, or time period when you know the other values.
Is a car loan simple interest or compound interest?
Many auto loans are simple interest on the declining balance, but payments are usually amortized — not the flat principal model this tool uses. For payment math, try our auto loan calculator.
How do you calculate simple interest for one month?
Divide the annual rate by 12 and multiply by principal: I = P × (annual rate / 100) / 12. Example: $10,000 at 6% per year → 10,000 × 0.06 / 12 = $50 for one month on a flat principal.
Is 1% per month the same as 12% per year for simple interest?
On a flat principal, yes — 1% simple interest each month for 12 months totals 12% of the original principal for the year. That is different from compounded monthly rates, where the effective annual yield (APY) is higher than the nominal 12%.
How is simple interest different from APY on a savings account?
APY includes compounding frequency on savings products. Simple interest does not compound. For HYSA shopping math, use our APY calculator.