Finance
Simple Interest Calculator
Find total interest earned using principal, annual rate, and time under simple interest.
Calculator
Results
- Interest earned$1,125.00
- Final amount$6,125.00
Formula
I = P × r × t; Final amount A = P + I
Use this formula with the live inputs above to test scenarios instantly.
Assumptions
- No compounding applied. Interest accrues linearly across time.
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How this formula works
Simple interest assumes interest accrues linearly over time rather than compounding. That makes it a useful model for educational examples and for products where interest is explicitly defined as a flat rate against principal.
Because there is no exponential growth component, the relationship is easy to audit and compare. The calculator is best used when your contract terms clearly specify simple (non-compounding) interest.
References & citation
Use these references when documenting assumptions, and copy the block below when citing this calculator.
- What is a mortgage?
Consumer Financial Protection Bureau
Explains principal, interest, and repayment concepts used in mortgage formulas.
- Compound Interest Calculator and Learning Resources
U.S. Securities and Exchange Commission (Investor.gov)
Provides compounding intuition and long-term growth examples.