By providing a user-friendly interface and accurate results, this calculator empowers individuals and businesses to make informed decisions about their financial endeavors. Our simple interest calculator helps you calculate the interest on a principal amount without considering compounding. So, if you have taken a loan, you can evaluate the payable fee at a simple interest rate. You can also evaluate the interest you are earning from deposits or investments. For example, if you decide to invest $5,000 in a savings account with an annual interest rate of 4%, you can calculate the simple interest you will earn in one year.

- If you purchase bonds from the government or a corporation, you will receive simple interest.
- Our Interest Calculator above allows periodic deposits/contributions.
- Our simple interest calculator helps you calculate the interest on a principal amount without considering compounding.
- However, in the past, they were issued by many financial institutions (insurers and banks) and even the governments.
- You’ll receive ₹800 every year (as simple interest) till the time you stay invested, and at the end of the tenure, you will recover the originally invested amount (₹10,000).

If you are not sure how to do this, read the APY calculator description, where everything is explained in detail. If you want to assume that interest from the previous periods influences the original amount, you should apply compound interest. Note here that if you make a deposit in a bank (e.g., put money in your savings account), from a financial perspective, it means that you lend money to the bank. Simple interest works in your favor as a borrower, since you’re only paying interest on the original balance.

In the former case, the interest is added to a separate pile of money each month (and is not subject to extra interest next month). By contrast, most checking and savings accounts, as well as credit cards, operate using compound interest. However, some assets use simple interest for simplicity — for example bonds that pay an interest coupon. Investments may also offer a simple interest return as a dividend. To take advantage of compounding you would need to reinvest the dividends as added principal.

Interest is usually calculated based on the principal and it can be easily calculated using this Interest Calculator. ET Money’s Simple Interest Calculator helps you to fund simple interest and maturity amounts you will have on maturity. Based on these results, you can compare various investment options and choose the one that offers you better returns. Now that you have the formula, you can use the calculator below to solve your homework problems. I designed this website and wrote all the calculators, lessons, and formulas.

## Sales & Investments Calculators

The interest is customarily expressed as a percentage (%) of the original amount (principal amount, balance). Under this formula, you can calculate simple interest taken over different frequencies, like daily or monthly. For instance, if you wanted to calculate monthly interest taken on a monthly basis, then you would input the monthly interest rate as “r” and multiply by the “n” number of periods. The Simple Interest Calculator calculates the interest and end balance based on the simple interest formula.

Class Diagrams, Use Case Diagrams, Entity–relationship(ER) Diagrams, Data flow diagram(DFD), Sequence diagram and software requirements specification (SRS) in report file. Simple interest is a form of interest commonly used for transactions such as auto loans, student loans or personal loans. Unfortunately, even if you had such an amount, currently, there are only a few existing financial products that are based on the concept of perpetuities. However, in the past, they were issued by many financial institutions (insurers and banks) and even the governments.

## Simple & Compound Interest Calculator

There are times when borrowers, depending on the manual method, people pay unpaid interest before principal. This situation leads to issues during computing simple interest on an amount. Following are some of the advantages of switching to an online calculator from the manual method. The simple interest calculator is designed to calculate how much interest you have earned on your principal investment. This online interest calculator compounds on a monthly basis, helping you determine the affects of compounding on interest-earning investments.

## Loan Calculators

An important distinction to make regarding contributions is whether they occur at the beginning or end of compounding periods. Periodic payments that occur at the end have one less interest period total per contribution. Anyone who wants to estimate compound interest in their head may find the rule of 72 very useful. Not for exact calculations as given by financial calculators, but to get ideas for ballpark figures.

You can explore great collection of other JavaScript projects. Now you know what is simple interest and how to calculate https://personal-accounting.org/ its value. So it’s high time you become familiar with more complex concepts of financial mathematics.

Thus, we can say that for the borrower, the interest rate is the cost of debt, and for the lender, it is the rate of return. In the next sections, we will also show you some examples of simple interest calculations. Therefore, at the end of the 3-year investment term, your investment will be worth $1,150. So, in one year, you will earn a simple interest of $200 on your investment of $5,000.

However, if Derek has a marginal tax rate of 25%, he will end up with $239.78 only because the tax rate of 25% applies to each compounding period. This interest is added to the principal, and the sum becomes Derek’s required repayment to the bank one year later. I hope this calculator and article has helped you with calculating the interest on your savings or loan.

## Simple Interest Calculator I = Prt

Simple interest charged per month is just the annual simple interest divided by the number of months in a year. Therefore, to calculate the monthly simple interest, you only need to calculate interest using the simple interest formula [(P x R x T) ÷ 100] and divide it by 12. The total amount of interest that is earned over a certain time period and the rate of interest is higher. The total amount of interest that is earned over a certain time period and the rate of interest is lesser. A savings account is an example of when simple interest is not used.

In this page Simple Interest Calculator project is a web application which is developed in JavaScript platform. This JavaScript project with tutorial and guide for developing a code. Simple Interest Calculator is a open source you can Download zip and edit as per you need. This is simple and basic level small project for learning purpose.