Interest Calculator
Enter a principal, a yearly rate and a length of time to get the simple interest and the final amount. You can also solve for the principal, the rate or the time, and see the same money grown with compound interest next to it.
Last updated November 4, 2026
Result
Interest $1,500.00
| Result | Value |
|---|---|
| Principal | $10,000.00 |
| Annual rate | 5% |
| Time | 3 years (3 years) |
| Simple interest | $1,500.00 |
| Final amount (simple) | $11,500.00 |
| Final amount, compounded monthly | $11,614.72 |
| Extra interest from compounding | $114.72 |
Assumes the rate is annual, interest does not compound, and there are no deposits, fees or taxes. Days are counted as days ÷ 365.
Show the work
Formula: I = P × r × t, A = P + I (r as a decimal, t in years; months ÷ 12, days ÷ 365)
- Time in years: 3 years is already in years.
- Rate as a decimal: 5% ÷ 100 = 0.05.
- I = $10,000.00 × 0.05 × 3 = $1,500.00
- Final amount A = P + I = $10,000.00 + $1,500.00 = $11,500.00.
- Compound comparison: $10,000.00 × (1 + r ÷ n)^(n × t) with monthly compounding = $11,614.72, which is $114.72 more than simple interest.
Result: Simple interest: Interest $1,500.00. Principal $10,000.00, rate 5% per year, time 3 years; interest $1,500.00, final amount $11,500.00. Compounded monthly the same money would reach $11,614.72 ($114.72 more).
The simple interest formula
I = P × r × t, A = P + I
P is the principal, the amount you lend or deposit. r is the yearly interest rate written as a decimal, so 5% is 0.05. t is the time in years. I is the interest and A is the final amount, the principal plus the interest. Because the interest is always worked out on the original principal, it grows by the same amount every year.
Rearranging the formula solves the other variables. The principal is P = I ÷ (r × t), the rate is r = I ÷ (P × t) and the time is t = I ÷ (P × r). The calculator uses these when you pick what to calculate.
See how we calculate for the formulas, sources and review schedule behind every calculator.
Also useful alongside this calculator: ROI Calculator, Annuity Calculator and Retirement Calculator.
Years, months and days
The rate is always a yearly rate, so the time must be converted to years first. Months are divided by 12. Days are divided by 365, an actual-day convention that treats every year as 365 days, including leap years. Some creditors use a 360-day year instead. For example, Regulation Z notes that some creditors use 1/360 of the annual rate as a daily periodic rate. It is a choice some lenders make, not a rule that applies to every loan or account. A 360-day year gives slightly more interest for the same number of days, so check your agreement if the last cent matters.
For example, $2,500 at 6% for 90 days earns 2,500 × 0.06 × 90 ÷ 365 = $36.99. The same amount for 18 months at 6% earns 2,500 × 0.06 × 1.5 = $225.
Simple interest compared with compound interest
With simple interest the interest never earns interest. With compound interest it is added to the balance each period, so the next period pays interest on a larger amount. Over one year at one compounding period per year the two are identical. Over longer times compounding pulls ahead: $10,000 at 5% for 10 years grows to $15,000 with simple interest, $16,288.95 compounded annually and $16,470.09 compounded monthly.
The comparison in the results uses the compounding you choose and the same principal, rate and time. To add regular deposits or see a year-by-year table, use the compound interest calculator.
Where simple interest is used
Short-term personal loans, some auto loans, many bonds that pay a fixed coupon and certain short deposits are quoted with simple interest. Credit cards, savings accounts and most long-term deposits usually compound. Whether you are the borrower or the saver, simple interest is the cheaper deal for the borrower and the weaker deal for the saver over long periods.
What the calculator assumes
The rate is annual and fixed for the whole period. Interest does not compound. There are no deposits, withdrawals, fees or taxes, and the principal stays the same. Time can be up to 100 years and the rate up to 100%. A real loan may also add fees or charge on a declining balance, so treat the result as an estimate of the interest formula, not a payoff quote.
General information, not financial advice
This calculator gives a general estimate from the numbers you enter. It is not financial or tax advice, and your actual results can differ. Check important decisions with a qualified professional or the official source.
Sources
Official and primary sources for the statements on this page. Their authors have not reviewed or endorsed this page.
- Consumer Financial Protection Bureau, Regulation Z, 12 CFR 1026.2 Definitions and rules of construction, official interpretation of 2(a)(21) Periodic rate (version of 2018-06-01). Says some creditors use 1/360 of an annual rate as their periodic rate, and that a creditor may disclose a 1/360 rate as a daily periodic rate if it is in fact applied only 360 days per year.
Official information: the CFPB page was opened and read on 2026-11-04. It supports only the statement that some creditors use a 360-day basis for a daily periodic rate. It does not say that every lender does, and it does not give the simple-interest formula.
Calculator method: I = P × r × t, with days ÷ 365 and months ÷ 12, is a standard formula and our own convention. The CFPB page is not a source for it.
How to use the Interest Calculator
- Choose what to calculate: interest and final amount, principal, rate or time.
- Enter the values you know, the yearly rate and the time with its unit (years, months or days).
- Pick a compounding frequency for the comparison with compound growth.
- Read the interest, final amount and comparison, open Show the work, then Copy, Print or Share.
Worked example
You deposit $10,000 at 5% a year. With simple interest the yearly interest is 10,000 × 0.05 = $500, so after 10 years the interest is $5,000 and the final amount is $15,000. Compounded monthly, the same deposit reaches $16,470.09.
| Years | Simple interest total | Compound monthly total |
|---|---|---|
| 1 | $10,500.00 | $10,511.62 |
| 5 | $12,500.00 | $12,833.59 |
| 10 | $15,000.00 | $16,470.09 |
| 20 | $20,000.00 | $27,126.40 |
Frequently asked questions
What is the difference between simple and compound interest?
Simple interest is paid only on the original principal. Compound interest is also paid on interest already added, so the balance grows faster the longer it runs.
How do I calculate simple interest for a number of days?
Divide the days by 365 to get years, then multiply principal, rate and years. For example, $2,500 at 6% for 90 days earns about $36.99.
Can I find the rate or the time instead of the interest?
Yes. Choose Interest rate or Time in the Calculate box, enter the interest you earned or want, and the calculator rearranges the formula. If you earned $1,500 on $10,000 in 3 years, the rate is 5%.
Does my lender use a 360-day year?
Some creditors do. The CFPB’s Regulation Z interpretation notes that some creditors use 1/360 of an annual rate as a daily periodic rate. It is not universal: many lenders and accounts use 365 days. This calculator uses 365 days, so a 360-day rule gives slightly more interest for the same days (for example $37.50 instead of $36.99 on $2,500 at 6% for 90 days). Check your agreement.