Free Simple Interest Calculator
Calculate simple interest and total repayment amount from principal, rate and time. Free. No signup required.
Simple interest adds the same flat $250.00 every year — unlike compound interest, none of it earns interest of its own. Tap any bar to see that year's balance.
- Total Amount$5,750.00
ƒShow your work
I = P × r × t
- 1I = $5,000.00 × 5% × 3 years = $750.00
About the Free Simple Interest Calculator
Simple interest is deliberately the boring version of interest math: I = P × r × t, with no compounding at all, so the interest owed or earned only ever depends on the original principal, never on interest that's already accrued. Most everyday borrowing and saving — credit cards, typical savings accounts, most mortgages — actually compounds, but simple interest still shows up in specific places: some short-term consumer and auto loans are structured this way, as are many promissory notes and bonds that pay a fixed coupon.
It's used most by people checking a specific claim: a loan document that says "simple interest," a finance class problem set, or a private loan between individuals where the terms were agreed as a flat rate times time rather than anything compounding.
The principal, rate and time period you enter stay in your browser — useful if you're checking the math on a private loan or note you'd rather not run through someone else's spreadsheet.
Frequently asked questions
What's the real difference between simple and compound interest?
Simple interest applies the rate to the original principal every period, so it grows in a straight line. Compound interest applies the rate to principal plus all interest already earned, so it grows faster the longer it runs — over short periods the two are close, but they diverge a lot over years.
Do banks actually use simple interest on savings accounts?
Almost never for consumer savings accounts — those compound, usually daily or monthly, even if the advertised rate is quoted annually. Simple interest is more common in structured loan products, bonds, and short-term notes than in everyday deposit accounts.
Is a "simple interest" car loan the same thing as this calculation?
Conceptually related but not identical — a simple interest auto loan usually still charges interest on a monthly amortizing basis where extra or early payments reduce future interest, rather than a single flat I = P×r×t figure calculated once for the whole term.
How do I calculate simple interest for less than a full year?
Convert your time period to years first — enter 0.5 for six months, or 0.25 for a quarter — and the same I = P × r × t formula applies, since t doesn't have to be a whole number.
Why does simple interest total less than compound interest over the same period?
Because compound interest earns returns on its own previously earned interest and simple interest never does — the two produce identical results only for a single compounding period, and compound interest pulls ahead every period after that.
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