Simple Interest Calculator - Principal, Rate and Total

The simple interest calculator uses the textbook formula I = P × r × t. P is principal, r is the annual rate as a decimal, and t is time in years. Interest is charged or earned only on the original principal, not on accumulated interest. That is why a $10,000 note at 5% for three years earns $1,500 of simple interest, not the larger amount you would see with annual compounding. Simple interest still appears on short consumer loans, some auto notes, courtroom judgments, and classroom problems. Many savings accounts and credit cards do not use it; they compound. If your statement shows APY or daily compounding, this page will understate growth or cost. For a true compound projection, use a compound or savings-plan calculator instead. Time is in years. Six months is 0.5, 18 months is 1.5, and 90 days is 90/365 if you follow an actual/365 convention. The engine does not convert days for you. Enter the rate as a percent (5 for 5%), not 0.05. The displayed result is interest only. Maturity value is principal plus interest; add them if you need the payoff or ending balance. Fees, prepaid interest, and day-count conventions (30/360 versus actual/365) can change a legal payoff. A 90-day commercial note at 6% on $20,000 is $20,000 × 0.06 × (90/365) under actual/365, which is not the same as entering time as 0.25 if the contract uses 30/360. Use the simple interest calculator as a transparent first estimate, then confirm the contract’s day count. Write down the day-count assumption next to the result so a later reader does not treat 0.25 years as a universal quarter. It is educational math, not a loan disclosure and not legal or tax advice. Add a second scenario with a slightly higher rate if origination fees are financed into the principal, because those fees raise the effective cost without changing the coupon printed on the note.