Interest Calculator
Calculate simple or compound interest earned or owed on any principal amount.
Interest Calculator
Calculate your interest instantly.
Total Interest
0What This Interest Calculator Does
This tool calculates either simple or compound interest based on the principal amount, interest rate, and time period. Simple interest is calculated only on the original principal, while compound interest is calculated on the principal plus accumulated interest from previous periods.
How to Use the Interest Calculator
Enter the principal amount you're starting with. Enter the annual interest rate. Enter the time period in years. Select either "Simple Interest" or "Compound Interest (Annual)" from the dropdown. The calculator instantly shows the total interest earned and the final amount.
Pro Tip: Compound interest grows your money faster than simple interest because you earn interest on interest. Use the compound option to see how your savings or investments can grow over time.
Simple Interest = P × r × t
Compound Interest = P × (1 + r)ⁿ − P
Where P = Principal, r = Rate, t = Time in years, n = Number of years
Simple vs Compound Interest
Simple Interest is calculated only on the original principal amount. It's commonly used for short-term loans and some savings accounts. Compound Interest is calculated on the principal plus any accumulated interest, making it the standard for most savings accounts, investments, and mortgages.
Frequently Asked Questions
Simple interest is calculated only on the principal amount. Compound interest is calculated on the principal plus any interest that has already been earned, meaning you earn interest on interest.
Compound interest can be compounded annually, semi-annually, quarterly, monthly, or daily. This calculator uses annual compounding. More frequent compounding results in higher total interest.
High-yield savings accounts typically offer rates between 3-5% APY. Traditional savings accounts often offer much lower rates. Always compare rates from different banks for the best deal.
Yes, you can use this calculator to estimate interest on loans. Select "Simple Interest" for simple interest loans, or "Compound Interest" for loans where interest compounds. For more detailed loan analysis, use our Loan Calculator.