What is a Daily Interest Calculator?
A daily interest calculator is a financial tool that helps you determine how much interest you'll earn on your principal amount over a specific number of days. Unlike traditional interest calculations that often use monthly or annual periods, this calculator provides a precise day-by-day calculation, making it ideal for short-term investments or loans.
When to Use a Daily Interest Calculator
This calculator is particularly useful in several situations:
When calculating interest for short-term deposits or loans that don't follow standard monthly cycles
When you need to determine the exact interest earned up to a specific date
When comparing different investment options that use daily compounding interest rates
How to Calculate Daily Interest
Daily interest calculations involve the following formula:
Daily Interest = Principal × (Annual Rate ÷ 365) × Number of Days
Where:
Principal is the initial amount of money
Annual Rate is the yearly interest rate (in percentage)
Number of Days is the period for which you want to calculate interest
The calculation process follows these steps:
Convert the annual interest rate to a daily rate by dividing by 365
Multiply the principal by the daily rate
Multiply this amount by the number of days
Daily Rate = Annual Rate ÷ 365 ÷ 100
Daily Interest = Principal × Daily Rate × Days
Total Amount = Principal + Daily Interest
Examples of Daily Interest Calculation
Example 1: Short-term Deposit
You deposit $5,000 at an annual interest rate of 3% for 30 days. How much interest will you earn?
Parameter
Value
Principal
$5,000
Annual Interest Rate
3%
Days
30
Daily Rate
0.00822% (3% ÷ 365)
Daily Interest
$12.33
Total Amount
$5,012.33
Example 2: Loan Interest
You borrow $10,000 at an annual interest rate of 6% for 15 days. How much interest will you need to pay?
Parameter
Value
Principal
$10,000
Annual Interest Rate
6%
Days
15
Daily Rate
0.01644% (6% ÷ 365)
Daily Interest
$24.66
Total Amount
$10,024.66
Example 3: Comparing Investment Options
You're comparing two investment options: Option A offers 3.5% annual interest for 60 days on $7,500, while Option B offers 3.65% annual interest for 45 days on the same amount. Which option yields more interest?
Parameter
Option A
Option B
Principal
$7,500
$7,500
Annual Interest Rate
3.5%
3.65%
Days
60
45
Daily Rate
0.00959% (3.5% ÷ 365)
0.01% (3.65% ÷ 365)
Daily Interest
$43.15
$33.78
Total Amount
$7,543.15
$7,533.78
Option A yields more interest despite the lower rate because the investment duration is longer.
Related Calculators
For more comprehensive financial planning, you might also find these calculators useful:
Simple Interest Calculator
Compound Interest Calculator
Savings Interest Calculator
Loan Interest Calculator
APY Calculator