When is simple interest actually used?

Short-term personal loans, some auto loans, treasury bills and many corporate bonds use simple interest. Most savings accounts and mortgages use compound interest.

How does this differ from compound interest?

Simple interest is only on the original principal. Compound interest also earns interest on previously accumulated interest, which grows faster over time.

Can I use months instead of years?

Enter a fractional year — for example, 0.5 for six months or 0.25 for three months.

Is the Simple Interest calculator free?

Yes — free to use, with no signup, no limits and no personal details required. The site is supported by advertising rather than subscriptions.

Is my data saved or sent anywhere?

No. Every calculation runs in your browser, so the numbers you type are never transmitted to us or stored on a server. Closing the tab discards them.

How accurate is the result?

The maths is exact for the inputs you give it. Accuracy in practice depends on those inputs matching your real situation — fees, rate changes and edge-case rules are the usual sources of difference. It is a planning tool, not financial advice.

Can I share or save my results?

Yes. Your inputs are stored in the page URL, so you can copy the link from the address bar (or use the share button) to bookmark a scenario or send it to someone else.

Simple Interest Calculator

Work out interest that doesn't compound — just principal × rate × time.

Your details

Principal

Annual interest rate

Time (years)

Total interest

£1,500

over 3 years

Principal

£10,000

Total amount

£11,500

How this is calculated

Simple interest is calculated only on the original principal — never on accumulated interest. The formula is I = P × r × t, where P is the principal, r is the annual rate (as a decimal) and t is the number of years.

Simple interest is used for short-term loans, some car loans and many bonds. For most savings and long-term loans, compound interest applies instead.

Who this calculator is for

This is aimed at anyone weighing up borrowing, saving or investing decisions before committing to them. It is most useful when you are comparing offers side by side, testing how sensitive a plan is to a change in rate or term, or sanity-checking a figure a lender or adviser has quoted you.

Assumptions and accuracy

Results assume the interest rate you enter stays fixed for the whole term and that payments are made on schedule. Real products may carry arrangement fees, early-repayment charges, variable rates, or different compounding intervals, all of which change the total. Use this to compare options, then confirm the exact figures with the provider.

Frequently asked questions

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