How to use Simple Interest Calculator
- Enter the Principal amountType the starting sum the interest is based on, for example 5000.
- Add the rate and timeEnter the Annual rate (%) as a percentage, such as 4.5, and the Time (years). Part years work as decimals, so six months is 0.5.
- Run it and read both figuresPress Run Simple Interest Calculator to see the interest earned and the total amount, each rounded to two decimals.
Common uses
- Checking the interest on a savings product that pays simple interest
- Estimating the cost of a short informal loan
- Verifying answers to maths homework on simple interest
Frequently asked questions
How do I use Simple Interest Calculator?
1. Enter the Principal amount: Type the starting sum the interest is based on, for example 5000. 2. Add the rate and time: Enter the Annual rate (%) as a percentage, such as 4.5, and the Time (years). Part years work as decimals, so six months is 0.5. 3. Run it and read both figures: Press Run Simple Interest Calculator to see the interest earned and the total amount, each rounded to two decimals.
Which formula does the calculator use?
Interest = principal × annual rate × years ÷ 100, and Total = principal + interest. With 5000 at 4.5% for 2 years, the interest is 450.00 and the total 5450.00.
Does it calculate compound interest?
No. Interest is worked out on the original principal only and is never added back for later periods. For loans paid in instalments, a loan calculator fits better.
Which currency does it use?
None. The result is a plain number with two decimals, so you can use it for any currency.
Where are my numbers processed?
The three values are sent to the GigaTools server, calculated there and shown on the same page. No third-party service is involved and no security check is needed.