The simple interest formula is the amount of money earning interest times the interest rate times the amount of time the money will earn interest. Investors are able to calculate their interest earned on a daily rate. This helps them track how much interest they earn each day. Simply daily interest is commonly calculated on bank accounts that earn interest and on loans to determine the interest the borrower must pay on the amount borrowed.
Determine the amount of money earning interest. This is the amount deposited in the bank account or the amount borrowed. For example, if a person has $500,000 in a savings account, the amount earning interest is $500,000.
Determine the interest rate on the account or amount borrowed. Using the example above, assume the savings account earns 5 percent interest.
Multiply the interest rate by the amount earning interest. In our example, $500,000 times 5 percent equals $25,000. This is the yearly interest.
Multiply the yearly interest by 1/365. In our example, $25,000 times 1/365 equals $68.50. This is the daily interest.