Finance Education Utility
Simple Interest Calculator
Calculate simple interest and ending total from principal, annual rate, and time in years.
Calculate simple interest
Formula
I is interest, P is principal, r is the annual rate expressed as a decimal, and t is time in years. The ending total is P + I.
Worked example
For a principal of 1,000, an annual simple-interest rate of 5%, and 3 years: interest = 1,000 × 0.05 × 3 = 150. The ending total is 1,150.
Simple interest versus compounding
Simple interest applies the rate to the original principal for the stated time. It does not add previously earned interest to the interest-bearing balance. If the scenario compounds, use a compound-interest model instead.
Limitations
This educational calculator does not include compounding, loan payment schedules, fees, taxes, day-count conventions, variable rates, late charges, or lender/investment-specific terms. It does not provide individualized financial advice.
Privacy
The arithmetic runs locally in the browser.
Common questions
Can the rate be zero?
Yes. A zero rate produces zero interest.
Can time include part of a year?
Yes. Enter a decimal such as 0.5 for half a year when that interpretation matches your calculation.