Weighted Interest Calculator

The most powerful free weighted interest calculator. Compute the true blended interest rate across multiple loans, savings accounts, or credit lines by weighting each rate by its principal balance. See live interactive charts and step-by-step breakdowns.

Data Entry

# Label (optional) Interest Rate % Balance ($) Rate × Balance

Quick Presets

Computation Flow

Live
Inputs Products Result
Result
0.00
Total Interest Cost0.00
Total Balance0.00
Total Accounts0

Balance Distribution

Live
0.00Blended Rate

Rate Comparison

Live

Result Gauge

Live
0 50 100
0.00
Lowest Rate
Highest Rate
Rate Spread
Largest Balance

Blended Interest Rate Calculator

Enter interest rates and balances to compute your true weighted blended rate across all accounts.

Input Data
# Account Name Rate (%) Balance ($)
Blended Rate
0.00%
Total Balance
Annual Interest Cost
Monthly Interest
Distribution Live
Add data to see chart

What Is a Weighted Interest Rate ?

Understanding Weighted Interest Rates

A weighted interest rate (also called a blended rate) is the average of multiple interest rates, where each rate is weighted by the outstanding balance or principal amount it applies to. Unlike a simple average, it reflects the true cost of borrowing or return on savings across all your accounts.

Blended Rate vs. Simple Average Rate

A simple average adds all rates and divides by count. A weighted average multiplies each rate by its balance, sums those products, then divides by the total balance. When loan amounts differ significantly, the blended rate gives a far more accurate picture of your true interest cost.

Interactive Balance Beam

Drag Sliders
4
1
90 70 86.00
Simple Avg Rate80.00
Blended Rate86.00
Difference6.00
Drag the sliders to see how balance amounts shift the blended interest rate compared to the simple average.

How to Use the Weighted Interest Calculator

1

Enter Your Interest Rates

Type each account's annual interest rate (APR) into the 'Rate' column. These are the rates on your loans, mortgages, savings accounts, or credit lines.

Rate85
2

Enter the Balances

Enter the outstanding balance or principal amount for each account. Larger balances have more influence on the blended rate.

Balance4
3

View Your Blended Rate

The calculator computes your true weighted interest rate instantly. See the blended rate, total interest cost, and interactive breakdown charts update in real time.

Blended Rate85.78

Weighted Interest Formula

The Blended Interest Rate Formula

w =
Σ (xi · wi)Σ wi
=
x₁w₁ + x₂w₂ + … + xₙwₙw₁ + w₂ + … + wₙ
wBlended interest rate result
xiEach interest rate (ráµ¢)
wiCorresponding balance (báµ¢)
ΣSum of all terms (Σ)

The weighted interest formula: multiply each rate by its balance, sum those products, then divide by the total of all balances. Mathematically: r̄ = Σ(rᵢ × bᵢ) / Σ(bᵢ).

Try the Formula Live

Live Formula — Edit Values

Interactive
Products:(85×4) + (92×3) + (78×2) = 340 + 276 + 156 = 772
Total Balance:4 + 3 + 2 = 9
Blended Rate:772 ÷ 9 = 85.78
7885.7892

How the Calculator Computes Blended Interest Step by Step

Inside the Weighted Interest Calculator

Rates

📐Mortgage = 85
🔬Car Loan = 92
📖Car Loan = 78

Balances

⚖️Balance = 4
⚖️Balance = 3
⚖️Balance = 2

Step 1: List rates and balances

Enter each account with its interest rate and balance. For example: Mortgage 4.5% ($250,000), Car Loan 6.9% ($25,000), Student Loan 5.2% ($45,000).

85×4=340
92×3=276
78×2=156

Step 2: Multiply each rate by its balance

4.5% × $250,000 = $11,250 · 6.9% × $25,000 = $1,725 · 5.2% × $45,000 = $2,340.

340+276+156
Σ Rate×Balance= 772

Step 3: Sum all the products

$11,250 + $1,725 + $2,340 = $15,315.

4+3+2
Σ Balances= 9

Step 4: Sum all the balances

$250,000 + $25,000 + $45,000 = $320,000.

7729
=
85.78Blended Rate

Step 5: Divide to get the blended rate

$15,315 ÷ $320,000 = 4.79%. Your true blended interest rate is 4.79%.

Common Interest Rate Mistakes

Averaging rates without considering balances

A 3% rate on $200K and an 18% rate on $5K have a simple average of 10.5%, but the weighted rate is only 3.37%. Ignoring balances dramatically overstates your cost.

Confusing APR and APY

APR is the annual rate without compounding. APY includes compounding effects. Make sure you use the same type of rate for all accounts when computing the blended rate.

Forgetting variable-rate accounts

If some accounts have variable rates, recalculate your blended rate periodically as rates change. A fixed-rate snapshot may become outdated.

Correct approach

Multiply each rate by its balance. Sum all products. Sum all balances. Divide. This calculator automates the entire process for accurate blended rates.

Weighted Interest Examples

🎓

Loan Portfolio Blended Rate

A borrower has a mortgage, car loan, and student loan at different rates. Compute the true blended interest cost.

AccountRate %BalanceProduct
Mortgage360
Car Loan225
Student Loan95
Blended Rate =85.00
85.00rate

The blended rate reflects the true cost of all debt. The mortgage dominates because it carries the largest balance.

💹

Savings Account Blended Yield

An investor has funds across three savings accounts with different APYs. Find the overall weighted yield.

AccountAPY %BalanceProduct
High-Yield Savings600000
Money Market150000
CD (12-month)160000
Blended Yield =9.10%
9.10%yield

The high-yield savings account has the most influence because it holds the largest balance.

Where Weighted Interest Is Used

🎓

Debt Consolidation

Determine your blended interest rate across all debts to evaluate whether a consolidation loan at a given rate would save money.

Mortgage (4.5%):90
Car Loan (6.9%):75
Blended Rate:85.0
💹

Mortgage Refinancing

Compare your current weighted rate across multiple mortgages against a refinancing offer to make informed decisions.

First Mortgage:12%
Second Mortgage:5%
Blended Rate:9.2%
📦

Savings Optimization

Calculate your blended savings yield across accounts to identify if reallocating funds to higher-rate accounts is worthwhile.

Savings ($50k):$5
CD ($30k):$8
Blended Yield:$6.00
📊

Business Lending

Banks compute weighted average cost of funds across deposits to set competitive loan rates and maintain margins.

Deposits (2.5%):4.0
Bonds (4.0%):3.0
Cost of Funds:3.71

Important Interest Rate Notes

⚖️

All balances must be positive. The calculator requires positive balances. A balance of zero means that account has no influence on the blended rate.

40% + 35% + 25% = 100% ✓
🔢

Equal balances = simple average rate. When every account has the same balance, the weighted interest rate equals the simple average of all rates.

W1=4, W2=1 → Weighted: 86.00 ≠ Simple: 80.00
📏

Blended rate falls between lowest and highest rates. No matter the balance distribution, the blended rate will always fall between the lowest and highest individual rates.

Min: 70
Max: 90
Result: 85.0 — always within range
🎯

Larger balances pull the blended rate toward that rate. The larger a balance relative to the total, the more the blended rate is pulled toward that account's rate. A $250K mortgage at 4% dominates over a $5K credit card at 18%.

Heavy weight pulls result to: 88.0

Explore Our Calculator Tools

Fifteen purpose-built weighted average calculators — each tailored to a specific domain with unique inputs, outputs, and interactive visualizations.

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Blended pay rates, overtime costs, and department salary analysis by headcount.

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Weighted durations, delivery estimates, and PERT scheduling by task frequency.

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Weighted mean, variance, standard deviation, and coefficient of variation analysis.

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Compute the weighted arithmetic mean from data values with different frequencies or importance weights.

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Compute composite scores from weighted categories for rubrics, tests, and evaluations with letter grades.

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Calculate VWAP, average purchase price, and procurement costs weighted by quantity or volume.

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Compute true portfolio returns by weighting each asset's performance by its dollar allocation.

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Combine ratings from multiple review sources weighted by review count or credibility.

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Interest Calculator

Compute blended interest rates across loans, savings, and credit lines weighted by balance.

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Profit Calculator

Analyze blended profit margins across products, services, and segments weighted by revenue.

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Weighted Interest FAQ