Simple Interest
Enter your known values, leave one input blank, and solves for the missing one. Try different units for next level excitement!
Learning zone
Simple interest pays only on the original principal, never on past interest: a $2,000 loan at 6% per year for 3 years costs I = 2000 × 0.06 × 3 = $360, exactly $120 each year. Enter the rate as a decimal (6% → 0.06) and keep the rate and the time in the same period — a monthly rate with months, a yearly rate with years.
Short-term personal loans, car loans, and bonds' coupon payments often work this way. Compare with compound interest, where each period's interest joins the principal and the total pulls ahead of the simple-interest straight line.
Simple Interest
Where
- = Interest earned
- = Principal
- = Interest rate per period (decimal)
- = Number of periods
Missing one of these? Work it out first, then come back
- Interest earned — Compound Interest (Periodic), Continuous Compounding
- Principal — Compound Interest (Periodic), Continuous Compounding
- Interest rate per period (decimal) — Compound Interest (Periodic), Continuous Compounding
- Number of periods — Exponential Growth, Exponential Decay