💰 Simple Interest Calculator UK
Calculate simple interest on loans and investments using UK financial standards
Simple Interest Formula
Where:
- P = Principal amount (initial sum)
- R = Annual interest rate (%)
- T = Time period (in years)
Total Amount = Principal + Simple Interest
How to Use the Simple Interest Calculator
- Enter Principal: Input the initial amount of money (loan or investment).
- Set Interest Rate: Enter the annual interest rate as a percentage.
- Choose Time Period: Enter the duration and select the time unit (years, months, or days).
- Select Calculation Type: Choose what you want to calculate (interest, total, rate, etc.).
- Calculate: Get detailed results including interest earned/paid and total amount.
Frequently Asked Questions
Simple interest is calculated only on the principal amount, while compound interest is calculated on both the principal and previously earned interest. Simple interest grows linearly, compound interest grows exponentially.
Simple interest is commonly used for short-term loans, some personal loans, car loans, and certain government bonds. Most savings accounts and long-term investments use compound interest.
For months: divide by 12. For days: divide by 365 (or 360 for some financial calculations). Our calculator automatically converts different time units to years for accurate calculations.
UK personal loan rates typically range from 3% to 25% APR, depending on credit score, loan amount, and term. Bank loans usually offer 3-8%, while alternative lenders may charge 10-25%.
Yes, this calculator is useful for simple interest investments like certain bonds or fixed-term deposits. However, most savings accounts and investments use compound interest, which grows faster over time.