Simple Interest Calculator

Calculate simple interest in multiple currencies with step-by-step solutions

Calculate Your Interest

Enter your financial details below to get instant results

Total Interest
$1,125.00

Principal Amount: $5,000.00

Total Amount: $6,125.00

Interest Rate: 7.50%

Time Period: 3 years

Step 1: Formula
Simple Interest = Principal × Rate × Time
Step 2: Convert Time
3 years (no conversion needed)
Step 3: Calculation
5000 × 0.075 × 3 = 1125
Simple Interest Formula
I = P × R × T
Where:
I = Interest Amount
P = Principal Amount
R = Annual Interest Rate (in decimal form)
T = Time Period (in years)

Understanding Simple Interest

What is Simple Interest?

Simple interest is a straightforward way to calculate interest on a loan or investment. It is calculated only on the original principal amount, without compounding.

When to Use It

Simple interest is commonly used for short-term loans, car loans, personal loans, and some investment products. It's easier to calculate than compound interest.

Simple vs Compound

Unlike compound interest, simple interest doesn't accumulate on previously earned interest. This makes it more predictable and easier to calculate.

Real-life Applications

Simple interest is used in many financial products: personal loans, car loans, short-term investments, and some mortgages.