Calculate simple interest using I = Prt formula. Find interest, principal, rate, or time with step-by-step solutions and growth charts.
You might also find these calculators useful
Simple interest is calculated using the formula I = P × r × t, where P is the principal (initial amount), r is the annual interest rate as a decimal, and t is the time in years. This calculator automates the process — enter your values and instantly see the total interest, end balance, monthly and daily interest breakdowns, and a step-by-step solution. For example, $10,000 at 5% for 3 years earns $1,500 in simple interest, giving you $11,500 total.
Simple interest is a method of calculating interest where the charge applies only to the original principal — there is no interest on interest. It is commonly used for auto loans, short-term personal loans, Treasury bills, promissory notes, and student loans during grace periods. Unlike compound interest (which grows exponentially), simple interest grows linearly, making it predictable and easy to calculate.
Simple Interest Formula
I = P × r × tKnow exactly how much interest you'll pay on a simple interest loan before you sign. Enter the principal, rate, and term to see total cost instantly.
Quickly compare different rates and terms to find the best deal. See how changing the rate from 5% to 6% or extending the term by a year affects your total interest.
See every calculation step rendered in proper mathematical notation (I = Prt). Perfect for students learning the formula or anyone who wants to verify the math.
Not just interest — find the required principal, time needed, or interest rate. Four calculation modes let you solve for whichever variable you need.
Calculate interest cost on simple interest auto loans and personal loans. Many auto lenders use simple interest, so this calculator shows exactly what you'll pay over the loan term.
Estimate interest earned on certificates of deposit, treasury bills, or short-term savings instruments that use simple interest calculations.
Solve I = Prt problems with step-by-step LaTeX-rendered solutions. See the formula, substitution, and final answer laid out in proper mathematical notation.
Compare different rate and term combinations to minimize borrowing costs. Use presets for personal loans, car loans, or student loans to see real-world scenarios.
The simple interest formula is I = P × r × t, where I is the interest earned, P is the principal (initial amount), r is the annual interest rate as a decimal, and t is the time in years. For example, $10,000 at 5% for 3 years: I = $10,000 × 0.05 × 3 = $1,500 in interest.
For 1 year: I = $5,000 × 0.05 × 1 = $250. Your end balance would be $5,250. For 5 years: I = $5,000 × 0.05 × 5 = $1,250, giving you a total of $6,250.
Use I = P × r × t with t = 2. For example, $20,000 at 4% for 2 years: I = $20,000 × 0.04 × 2 = $1,600 in interest. The end balance would be $20,000 + $1,600 = $21,600.
For 1 year: I = $50,000 × 0.02 × 1 = $1,000. Your end balance would be $51,000. For 5 years: I = $50,000 × 0.02 × 5 = $5,000, giving you $55,000 total.
Simple interest is calculated only on the original principal (I = Prt), so it grows linearly. Compound interest is calculated on principal plus accumulated interest (A = P(1 + r/n)^(nt)), so it grows exponentially. Over time, compound interest yields significantly more. Simple interest is better for borrowers; compound interest is better for savers.
Auto loans, some personal loans, short-term business loans, Treasury bills, promissory notes, and student loans during grace periods typically use simple interest. Mortgages and credit cards usually use compound interest.
Calculate the annual interest using I = P × r × t (with t = 1 year), then divide by 12. For $10,000 at 6%: annual interest = $10,000 × 0.06 = $600, so monthly interest = $600 ÷ 12 = $50 per month.
It depends on your role: simple interest is better for borrowers because you pay less total interest. Compound interest is better for investors and savers because you earn more. Most savings accounts and investments use compound interest, while some loans use simple interest.