Accrued Interest Calculator and How It Works

An accrued interest calculator estimates the interest that has built up on a loan or other interest-bearing balance over a specified period but has not yet been paid. Enter the principal, annual interest rate, and number of days; the calculator returns estimated accrued interest and the balance including that interest.

Formula

This calculator uses simple interest on an actual-days-over-365 basis:

Accrued interest = principal × (annual rate ÷ 100) × days ÷ 365

• Principal (p) is the balance on which interest accrues, in dollars.
• Annual rate (apr) is the annual interest rate entered as a percentage, such as 6 for 6%.
• Days is the number of days in the accrual period.
• Accrued interest (ai) is the estimated unpaid interest in dollars.

The second output adds the unrounded calculated interest to principal and rounds the displayed result to cents. This is a simplified estimate: actual contracts may define the day-count convention differently, apply daily compounding, or use changing balances. A zero-day period produces zero interest.

Worked Example

Using the calculator’s default values—$10,000 principal, 6% annual interest, and 30 days:

1. Convert the percentage to a decimal: 6 ÷ 100 = 0.06.
2. Multiply by the principal: $10,000 × 0.06 = $600 per year under the simple-interest assumption.
3. Apply the fraction of a 365-day year: $600 × 30 ÷ 365 = $49.315…
4. Round to cents: accrued interest is $49.32.
5. Add it to the principal: $10,000 + $49.315… = $10,049.315…, or $10,049.32 displayed.

The calculation does not imply that the lender will charge exactly this amount: the agreement’s balance, rate, calendar method, and posting rules determine the actual figure.

Assumptions

• The principal stays constant throughout the period.
• The annual rate is fixed for the entered days and is expressed as a percentage per year.
• Interest is simple, not compounded; the calculation uses actual days divided by 365.
• Interest is treated as accruing over the entered period; no payment timing or payment posting is modelled.
• Fees, taxes, insurance, penalties, and changes to the balance are not included.

What Accrued Interest Means

Accrued interest is interest that has accumulated with the passage of time but has not necessarily been billed, paid, or added to the amount owed. It is different from a scheduled payment: a payment can cover principal, interest, fees, or some combination, depending on the agreement. It is also distinct from the interest rate itself, which is a percentage used to calculate interest rather than a dollar amount.

The term appears in several settings. A loan can accumulate interest between payment dates; a bond can accumulate interest between coupon payments; and a savings or deposit account can earn interest before it is credited. The underlying arithmetic may look similar, but contracts and account rules can differ. This calculator is specifically a basic simple-interest estimate and does not model bond settlement conventions, account-specific crediting, or loan servicing rules.

How to Use the Estimate

Use the principal and rate that apply to the period, then count the days from the start of accrual to the relevant date. Check the account statement or agreement to identify the balance being used and whether the stated rate is the appropriate rate for this calculation. If the balance changes during the period, a single-principal calculation may not represent the actual accrued amount.

• For a loan: the estimate can help explain why a payoff figure may include interest accumulated since the last payment. The payoff figure can also include other items not represented here.
• For a bond: accrued interest is commonly relevant when a transaction occurs between scheduled interest-payment dates, but market conventions and settlement terms may use a different day-count basis.
• For a deposit: interest may accrue before it is posted to the account. The institution’s compounding and crediting rules matter for the eventual balance.

Use days as a count, not as months. A month does not always have the same number of days, and this calculator does not convert a month into a fixed number of days. For a period spanning a leap year, verify whether the governing calculation uses a 365-day denominator, 366 days, or another convention.

Common Sources of Difference

A calculator estimate can differ from a statement or payoff quote for several ordinary reasons. The most important is the day-count convention: some calculations use actual days over 365 or 366, while others use a defined 360-day year or a 30-day-month convention. Compounding can also change the result because interest may be calculated on a balance that already includes previously accrued interest.

• Changing principal: payments, withdrawals, advances, or adjustments can make the balance vary during the period.
• Rate changes: a variable rate may have changed, so one annual rate cannot describe the entire period.
• Dates and posting: the start date, end date, payment receipt date, and posting cut-off can affect the number of accrual days.
• Rounding: an account may round interest daily or per transaction instead of rounding only the final estimate.
• Other amounts: fees or contractual adjustments may appear in a balance but are not interest calculated by this formula.

For an exact amount, compare the calculator’s assumptions with the applicable account documents or ask the account provider how it computed the figure. Do not treat the output as a substitute for an official statement or payoff amount.

Frequently Asked Questions

What is accrued interest?
It is interest that has accumulated over time but has not yet been paid or otherwise settled. Whether it is added to a balance or paid separately depends on the account or contract.

How do you calculate accrued interest?
For simple interest, multiply principal by the annual rate as a decimal and by the fraction of the year elapsed. This calculator uses days divided by 365 as that fraction.

Is accrued interest the same as compound interest?
No. Simple accrued interest in this calculator is based on the original principal. Compound interest adds prior interest to the balance used for later calculations, so it can produce a different amount.

Why does my statement show a different amount?
The statement may use another day-count convention, daily compounding, a changing balance or rate, different dates, or transaction-level rounding. The calculator also excludes fees and other account adjustments.

Does accrued interest mean I owe it immediately?
Not necessarily. It describes interest accumulated, not its payment due date or how it is settled. Check the account terms or official statement for those details.

This result is an estimate for educational purposes; the account provider’s disclosure or statement gives the exact figures.

Related

• Accrued Interest Expense: Meaning and Calculation
• Accrued Interest Calculator in Excel
• Accrued Interest Excel Formula and Calculator

in p | Principal balance | $ | 10000 | 0.01 | 100000000
in apr | Annual interest rate | % | 6 | 0.01 | 100
in days | Days accrued | days | 30 | 0 | 3650
out ai | Accrued interest | $ | p * (apr / 100) * days / 365 | 2
out bal | Balance including accrued interest | $ | p + ai | 2