Simple Interest Calculator
Interest calculations play a crucial role in personal finance, business investments, and loan payments. Whether you’re saving money, investing, or borrowing, understanding simple interest can help you make smarter financial decisions.
Our Simple Interest Calculator allows you to calculate the missing value from the formula:
A = P(1 + rt)
Where:
- A = Final Amount
- P = Principal Amount (Initial investment or loan)
- r = Annual Interest Rate (in decimal form)
- t = Time (in years)
Simple Interest vs. Compound Interest
Most savings and loans use compound interest—check out our compound interest calculator, which adds interest to the principal over time. However, simple interest is easier to calculate and is often used for:
- Short-term loans
- Car loans
- Some student loans
- Basic investment calculations
| Feature | Simple Interest | Compound Interest |
|---|---|---|
| Formula | A = P(1 + rt) | A = P(1 + r/n)^(nt) |
| Growth | Linear | Exponential |
| Common Use | Short-term loans, personal finance | Savings accounts, mortgages, investments |