Simple Interest Calculator
Compute interest using I = P × r × t (no compounding). Used for short-term consumer loans, T-bills, and savings without compounding.
FINANCECompute simple interest (I = P × r × t) with no compounding effect, plus the total amount due (P + I) and a side-by-side comparison against compound interest for the same period.
Simple interest is rare in modern finance — it shows up in short-term consumer loans (some payday and title loans, T-bills) and in homework problems. Most savings, credit cards, and mortgages use compound interest. The longer the period and higher the rate, the more dramatically compound beats simple.
Simple Interest Calculator
Compute interest using I = P × r × t (no compounding). Used for short-term consumer loans, treasury bills, and savings calculations where interest does not earn additional interest.
Formula
Simple Interest = Principal × Rate × Time
Where rate is the annual rate as a decimal and time is in years. For monthly or daily inputs, divide by 12 or 365. Most US auto loans, mortgages, and savings accounts use compound interest instead — use the Compound Interest Calculator for those.
Simple interest is rare in modern finance - check your loan or savings agreement to confirm whether compounding applies and at what frequency (monthly, daily, continuous).