Simple Interest Calculator

The simple interest calculator helps to estimate the interest amount using principal amount, annual interest rate, and investment time.

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How to Use the Simple Interest Calculator?

  1. Enter the principal amount, annual interest rate, and investment time (in days, weeks, months, quarters, or years).
  2. After entering all the values, click the 'Calculate' button.
  3. As a result, the tool returns the interest earned and the total amount (including interest).

How to Calculate Simple Interest?

The simple interest is calculated using the following formula.

A = P(1 + rt)

Where,

A = Final amount (principal + interest)
P = Principal amount
r = Annual interest rate (decimal)
t = Time (in years)

Let's take an example.

Example:

A person invested $2300 at the annual interest rate of 5.6% for 3 years. Find out the interest amount.

Solution:

Here,

P = $2300,
r = 5.6% = 5.6/100 = 0.056 (in decimal),
t = 3 (years).

Put all the values in the formula.

A = P(1 + rt)

= 2300 × (1 + (0.056 × 3))

= 2300 × (1 + 0.168)

= 2300 × 1.168

= 2686.4

Interest Earned = $2686.4 - $2300 = $386.4.

So, after 3 years, you will earn interest of $386.4 and the invested amount will become $2686.4.