Simple Interest Calculator

Enter the principal, the rate and the term to see how much interest accrues.

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Results

Interest
$147.95
Total at the end
$10,147.95
Interest per day
$1.64
Interest per month
$50.00

A 365-day year is used. With simple interest, interest is earned on the principal only — never on earlier interest.

With simple interest, interest is charged on the principal only; interest already earned is never added back to earn more. It is used for short-term loans, late-payment interest and some bonds.

There is one formula: principal times annual rate times the term in years. When you enter the term in days the calculator uses a 365-day year.

How to calculate Simple interest

  1. Enter the principal and the annual interest rate.
  2. Enter the term and choose its unit: days, months or years.
  3. Read the interest, the total at the end and the interest per day.

Simple interest formula

  • Interest = principal × annual rate × time (years)
  • In days: interest = principal × rate × days ÷ 365
  • Total = principal + interest

Simple interest example

10,000 at 12% simple interest for 90 days earns 10,000 × 0.12 × 90 ÷ 365 = 295.89, for a total of 10,295.89.

Simple interest: common questions

What is the difference between simple and compound interest?

Simple interest is always charged on the original principal. With compound interest, each period’s interest is added to the principal and earns interest in the next.

Is a year 360 or 365 days?

This calculator uses 365. Some banks and commercial contracts use 360, which makes the interest slightly higher.

How do I turn a monthly rate into an annual one?

For simple interest, multiply by 12: 1% a month is 12% a year.