Simple Interest Calculator
A basic Simple Interest Calculator is an online tool for calculating interest on loans and savings accounts without compounding. On a daily, monthly, or yearly, you can calculate simple interest on the principal amount.
What is Simple Interest?
Simple interest is a technique used to calculate the proportion of interest paid on a sum over a set time at a fixed rate. The principal amount remains constant in simple interest. Simple interest is a straightforward technique for calculating interest in money.
When is simple interest used?
Simple interest (SI) is an interest charge that borrowers pay lenders for a loan. It is calculated solely on the principal and does not include compounding interest. SI does not only apply to specific loans. It is also the type of interest that banks pay on savings accounts. SI can use in the following ways:
- when one has borrowed money
- when someone lends money
- when someone has invested money
Simple Interest Formula
To calculate the Total Maturity Amount Value:
The formula for the simple interest calculator
A = P(1 + rt)
Here,
A : Total accumulated amount (principal + interest)
P : Principal Amount
r:Rate of Interest per year in decimal; r = R/100
t :Period (years or months)
To calculate the interest on the Investments & loans
SI= P X RX T/100
Here,
SI : Simple Interest
R : Rate of Interest
T :Time
P :Principal
This formula is used by the SI calculator to quickly calculate interest rates and estimate the increase in the value of the initial investment. Let's look at an example to understand it better.
Mr A has invested Rs. 15000 at a 5% interest rate for nearly two years. As a result, his SI will be Rs. (15000 X 5 X 2/100), which equals Rs.16500.
How to Calculate Simple Interest using a Calculator?
Please enter the principal, rate and time value, and the result will calculate quickly.
Example
If the principal amount is Rs 10,000 the interest rate is 10%, and the years are six.
we can calculate the SI asA = 10,000 (1+0.1*6) = Rs 16,000. Interest = A – P = 16000 – 10000 = Rs 6,000.
How to use the Simple Interest (SI) Calculator?
- You must select the interest type as simple interest.
- Enter the principal amount.
- You then enter the annual interest rate.
- It would be best to choose the duration in days, weeks, quarters, or years.
- The SI Calculator shows the simple interest earned on the deposit.
How can the Simple Interest (SI) Calculator help us?
- This simple interest calculator calculates both the principal and the interest.
- Although it is simple to calculate simple interest for shorter tenors over long periods, a manual mechanism increases the possibility of errors. For an accurate calculation, use an online simple interest calculator
- This a quick and straightforward way to learn about interest and raised invested capital.
Advantages of using Simple Interest Calculators:
- SI will compute without regard to any unit. It works well with the dollar, euro, and other currencies.
- Users who want to save time calculating interest rates with changing years can use it wisely.
- There are numerous variables available to help you determine your total investment. Knowing the total return and maturity time allows you to make more informed decisions.
- A simple interest calculator can use to calculate the current value of money
FAQ'S
What is a Simple Interest Calculator?
A primary interest calculator is handy for calculating interest on loans and savings accounts without compounding. On a daily, monthly, or yearly, you can calculate simple interest on the principal amount.
What is simple interest calculator formula?
The formula for Simple Interest (SI) = P X RX T/100.
What can I determine with the help of SI calculators?
Users can determine the interest rate on the principal amount and the total return incurred after the completion of tenure.
How do I calculate simple interest monthly?
SI charged per month is just the annual simple interest divided by the number of months in a year. Formula [(P x R x T) ÷ 100] and divide it by 12.