Calculate simple interest and end balance, or solve for the principal, term, or rate — using the plain Interest = Principal × Rate × Time formula.
Simple interest only ever looks at the original principal — never at interest that's already accrued. Whether it's calculated once a year or once a decade, the interest for any stretch of time is always the same fraction of that original amount. That's what makes it "simple": no snowball effect, no interest earning its own interest, just a flat, predictable rate applied to a fixed base.
Most everyday savings and loans use compound interest, but simple interest survives in specific corners of finance — some short-term loans, certain bonds, add-on interest auto loans, and many statutory or legal interest calculations (like interest owed on a late payment) use it because it's transparent and easy to verify by hand.
Yes — since interest doesn't compound, a borrower under a simple-interest loan generally pays less total interest than an equivalent compound-interest loan at the same stated rate and term.
Use the Investment Calculator or Interest Calculator, which model interest earning interest over time rather than a flat rate applied only to the original principal.
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