Simple interest is calculated only on the original principal amount, unlike compound interest which also earns interest on accumulated interest. The formula is: Interest = Principal × Rate × Time. This type of interest is commonly used for short-term loans, car finance, and some savings accounts. Our simple interest calculator lets you enter the principal amount, annual interest rate, and time period to instantly calculate the total interest earned or owed, and the final amount. Use it to compare simple versus compound interest products when choosing savings accounts or loans.