Simple Interest Calculator
Calculate the simple interest and total amount for a loan or investment.
Result:
Understanding Simple Interest
Simple interest is a quick and easy method of calculating the interest charge on a loan. It is determined by the principal amount, the interest rate, and the length of time.
Formulas
The two key formulas for simple interest are:
- Total Amount: \(A = P(1 + rt)\)
- Interest Amount: \(I = Prt\)
Where:
- \(P\) = Principal amount (the initial amount of money)
- \(r\) = Annual interest rate (as a decimal)
- \(t\) = Time period (in years)
- \(A\) = Total amount after interest
- \(I\) = Total simple interest
How This Tool Works
This calculator operates entirely client-side, ensuring your data remains private and is never sent to a server. It takes the values you enter for Principal, Annual Rate, and Time, and performs the following calculations:
- The interest rate is automatically converted from a percentage to a decimal (e.g., 5% becomes 0.05).
- The simple interest is calculated using the formula \(I = Prt\).
- The total amount is then calculated by adding the interest to the principal, \(A = P(1 + rt)\).