Formula library
Compound interest uses a future-value formula for the starting amount plus a future-value formula for monthly savings. The calculator converts the selected compounding frequency into an effective monthly rate so monthly contributions are not treated as if they were deposited every day.
A = P(1 + r/n)^(nt) + PMT * (((1 + r/n)^(nt) - 1) / (r/n))
Simple interest uses I = P * r * t. Savings goal mode solves for either the monthly contribution needed to reach a target or the number of months needed at a given monthly contribution. Loan mode uses the standard fixed-payment amortization formula.
Calculator assumptions
- Rates are entered as annual percentages.
- Monthly contributions are assumed to happen once per month.
- Inflation reduces buying power using the inflation rate entered by the user.
- Tax inputs are simplified and reduce estimated interest rather than modeling account-specific tax rules.
- Loan estimates assume fixed interest, fixed payment timing, and no extra fees unless entered elsewhere by the user.
Data sources and update policy
The calculators do not pull live bank rates, market forecasts, tax brackets, lender fees, or inflation data. Users choose the assumptions they want to test. Example scenarios use rounded educational inputs and are reviewed when calculator behavior changes, when a new guide is added, or when a user reports a confusing or incorrect example.
Limitations
The site does not model market volatility, sequence of returns, account-specific contribution limits, tax-loss harvesting, required minimum distributions, lender fees, insurance, property taxes, hardship programs, or personal risk tolerance. It is a comparison tool, not a financial planning platform.
Accuracy notes
Calculations use standard formulas and are rounded for display. Small differences can appear compared with banks, brokerages, or lenders because those institutions may use exact daily balances, payment calendars, compounding conventions, fees, and account-specific rules. Important decisions should be checked against official account or loan documents.
APR vs interest rate
The interest rate describes the cost of borrowing money before some fees. APR can include certain fees and therefore may be better for comparing loan offers. Two loans with the same payment can still have different total costs when fees or terms differ.
How inflation changes savings goals
Inflation means a future dollar may buy less than a dollar today. A nominal final balance answers how many dollars may be present. A buying-power estimate asks what those future dollars might be worth in today's terms.
How taxes affect investment returns
Taxes can reduce spendable returns, but the exact effect depends on account type, timing, income, location, and the type of gain. The calculator's tax input is a simplified stress test, not tax advice.
How to compare loan offers
Compare monthly payment, total interest, APR, term length, fees, prepayment rules, and the risk of stretching a loan to lower the payment. A lower payment can cost more if it extends the term too far.
How to build a conservative scenario
Lower the return assumption, raise inflation, shorten the timeline, and reduce monthly contributions. If the plan still works under that version, the decision is less dependent on a perfect path.