Simple Interest Calculator

Principal:

Use the original balance before interest; changing balances and payments are outside this estimate.

Annual simple rate:

For example, enter 6.25 for 6.25% per year.

% / year

Term:

Months divide by 12; weeks and days use the selected day-count basis.

Day-count basis:

Actual / 365 is the general default. Use a 360-day convention only when the quote specifies it.

Interest withholding:

Use 0 when gross and net interest should match.

Checkpoint cadence:

Long schedules are evenly sampled to keep the result usable, with maturity always included.

Start date:

Leave blank when only elapsed time matters.

Scenario label:

Avoid account numbers or private customer details because shareable inputs can appear in the URL.

Metric	Value	Meaning	Copy
{{ row.label }}	{{ row.value }}	{{ row.detail }}

Checkpoint	Projected date	Gross interest	Net maturity	Copy
{{ row.label }}	{{ row.date }}	{{ money(row.grossInterest) }}	{{ money(row.netMaturity) }}

Interest grows in a straight line when the principal never changes and earned interest does not itself earn interest. That is the defining feature of simple interest. Each equal slice of time adds the same dollar amount, so doubling the term doubles the interest when the principal and annual rate stay fixed.

This pattern appears in classroom problems, short-term deposits, private notes, and some quoted returns. It is not a universal description of loans or savings accounts. A loan with payments has a changing outstanding balance, and a compounding account adds earlier interest to the balance used for later periods. Annual percentage rate (APR) and annual percentage yield (APY) also carry disclosure meanings that should not be substituted for a simple annual rate without checking the agreement.

Interest methods compared
Method	Balance used	Typical consequence
Flat simple interest	Original principal for the whole term	Interest follows a straight line
Outstanding-balance interest	Balance after payments or changes	Payment timing changes total interest
Compound interest	Principal plus credited interest	Growth accelerates over time

Time basis matters most for day- and week-based quotes. Dividing by 360 rather than 365 produces a larger year fraction for the same number of elapsed days. Month and year inputs in this model use 12 months per year, so their interest does not change when the day-count basis changes. A written quote or contract controls which convention belongs in a real comparison.

The result is an educational estimate, not a payoff statement, tax calculation, lending disclosure, or investment recommendation. Fees, changing balances, compounding, payment schedules, penalties, variable rates, and jurisdiction-specific withholding require a model that includes those terms.

How to Use This Tool:

Use the original fixed balance and the quoted simple annual rate. If the agreement describes payments, compounding, APR, or APY, confirm that a flat-principal estimate is the right comparison.

Enter the Principal, Annual simple rate, and Term. Enter 6.25 for a rate of 6.25% per year.
Choose the stated Day-count basis. Use Actual / 365 unless the quote specifies Actual / 360 or 30 / 360.
Open Advanced only when you need a planning withholding rate, schedule checkpoints, a projected start date, or a short scenario label. Checkpoint cadence changes the reporting rows, not the final interest.
Compare Gross interest, Net interest, and the corresponding maturity amounts. Recheck the rate type and basis before relying on the estimate.

Interpreting Results:

Gross interest is the flat-principal return before the optional withholding assumption. Net interest subtracts that assumption, while gross and net maturity add the relevant interest amount back to principal. The term yield is the gross interest divided by principal over the selected term; it is not an annualized APY.

The accrual schedule divides the same straight-line result into checkpoints. It does not add compounding or payment events. For a day- or week-based quote, compare the day-count difference and match the agreement. For a month- or year-based term, a zero basis difference is expected in this model.

Technical Details:

Flat simple interest depends on three quantities: fixed principal, an annual rate expressed as a decimal, and a year fraction. No intermediate interest is added to principal, so the gross accrual remains proportional to time.

Formula Core:

The primary equation and the optional withholding adjustment are:

\begin{array}{rcl} I & = & P \times r \times t \\ I_{net} & = & I \times (1 - w) \\ M_{net} & = & P + I_{net} \end{array}

P is principal in USD, r is the annual rate divided by 100, t is the year fraction, and w is the entered withholding percentage divided by 100. Money is calculated at full floating-point precision and displayed to two decimal places.

For $15,000 at 6.25% for 18 months, the year fraction is 18 ÷ 12 = 1.5. Gross interest is $15,000 × 0.0625 × 1.5 = $1,406.25, giving a gross maturity amount of $16,406.25.

Time and Day-Count Rules:

Year-fraction rules by term unit
Term unit	Year fraction	Effect of basis
Years	Entered years	No change
Months	Months ÷ 12	No change
Weeks	Weeks × 7 ÷ denominator	Uses 365 or 360
Days	Days ÷ denominator	Uses 365 or 360

Actual / 365 uses a denominator of 365. Actual / 360 and 30 / 360 use 360 for the year fraction. For projected schedule dates, 30 / 360 treats each entered month as 30 days; other month-based schedules use one-twelfth of the selected denominator. Dates are reporting aids and do not change final interest.

Checkpoint rows linearly multiply final gross and net interest by an elapsed fraction. A long schedule is sampled to at most 120 checkpoints, and maturity is always included. The “+1 percentage point” amount is P × 0.01 × t, which shows the dollar effect of a nearby rate over the same fixed term.

Accuracy and Privacy Notes:

The estimate assumes the original principal remains unchanged. It does not model deposits, withdrawals, installments, amortization, or early payoff.
The withholding field is a user-entered planning haircut, not a tax rule. Confirm the applicable rate, timing, exemptions, and jurisdiction separately.
Calculations run in the browser. Shareable inputs may appear in the page URL, so do not put account numbers or private customer details in the scenario label.
Use the result for education and quote comparison, not as financial, tax, or legal advice.

References:

Calculating loan payments worksheet, Consumer Financial Protection Bureau.
Simple interest rate and precomputed interest, Consumer Financial Protection Bureau, January 30, 2024.
Regulation DD definitions, Consumer Financial Protection Bureau.