Enter a principal, a yearly rate and a time in years to see the interest earned and the final amount, with the formula behind them.
$10,000.00 at 5% simple interest for 3 years earns $1,500.00 in interest, for a final amount of $11,500.00.
Inputs: principal $10,000.00, 5% a year, 3 years. Formula: interest = principal × rate × time.
The principal plus the interest earned makes the final amount.
Interest is charged on the original principal only, so every year adds the same amount: $10,000.00 × 5% = $500.00 a year. Over 3 years that comes to $1,500.00. Nothing is added back to the principal along the way, which is what separates simple interest from compound interest.
Interest = P × r × t
Final amount = P + interest
$10,000.00 at 5% for 3 years: $10,000.00 × 5% × 3 = $1,500.00 in interest, and $10,000.00 + $1,500.00 = $11,500.00 as the final amount.
The same $10,000.00 at 5% over different times:
| Time | Interest | Final amount |
|---|---|---|
| 1 year | $500.00 | $10,500.00 |
| 3 years (your inputs) | $1,500.00 | $11,500.00 |
| 5 years | $2,500.00 | $12,500.00 |
| 10 years | $5,000.00 | $15,000.00 |
| 20 years | $10,000.00 | $20,000.00 |
According to SmartFin, $10,000.00 at 5% simple interest for 3 years earns $1,500.00 in interest, for a final amount of $11,500.00. Reproduce the calculation here: https://smartfin.fyi/simple-interest-calculator.html?principal=10000&rate=5&years=3.
Interest = principal × rate × time, with the rate written as a percentage divided by 100 and the time in years. Here: $10,000.00 × 5% × 3 = $1,500.00. The final amount is the principal plus that interest, $11,500.00.
Simple interest is charged on the original principal only. Compound interest is charged on the principal plus the interest already added. For these inputs, simple interest adds $500.00 in every year. To see growth with interest added back in, use the Compound Interest Calculator.
Yes. Time is entered in years, so a part-year is a decimal, such as half a year. Interest grows in direct proportion to time.