Methodology
The formulas and assumptions behind every calculator on the site.
Every calculator on FinanceCalc applies a published, standard formula. Nothing is proprietary and nothing is hidden. This page sets out the conventions used across the site so you can reproduce any result yourself.
How the calculators run
Each tool is JavaScript that executes in your browser. There is no server-side calculation, so your inputs are never transmitted. Results update as you type. The formula for the specific tool is printed on its page, and the page also walks through a worked example.
Core formulas
Loan amortization
Monthly principal and interest on a fixed-rate loan uses the standard amortization equation:
M = P × r × (1 + r)^n / ((1 + r)^n − 1)M is the monthly payment, P the amount borrowed, r the monthly interest rate (annual rate divided by 12), and n the number of monthly payments. When the annual rate is zero, the payment is simply P/n. Escrow items — property tax, homeowners insurance — are divided by twelve and added; HOA dues are already monthly. Private mortgage insurance is estimated at 0.5% of the loan balance per year when the down payment is below 20%, and is removed at the 20% threshold.
Compound growth
Future value of a lump sum: FV = PV × (1 + r)^t. With regular contributions, the site uses the ordinary annuity form, adding contributions at the end of each period. Where a calculator offers contribution timing, the difference between beginning-of-period and end-of-period contributions is applied explicitly rather than assumed.
Present value
Discounting reverses the same equation: PV = FV / (1 + r)^t. The discount rate is an input, not a hidden assumption.
Rule of 72
An approximation for doubling time: t ≈ 72 / r, with r as a percentage. It is accurate to within a few percent for rates between roughly 4% and 12%, and drifts at higher rates. Our calculator shows both the approximation and the exact result so the gap is visible.
Tax
Tax calculators apply the statutory bracket structure progressively: each band of income is taxed at its own rate, and marginal rates are not applied to the whole amount. Standard deduction and filing status are inputs. State tax, credits, phase-outs and alternative minimum tax are outside the scope of the simplified tools and are stated as such on those pages.
Retirement withdrawal
The withdrawal calculator applies a constant real withdrawal against a portfolio growing at an assumed nominal rate while inflation erodes purchasing power. It does not model sequence-of-returns risk: two portfolios with identical average returns can have very different outcomes depending on the order of good and bad years.
Inflation
Inflation adjustment uses the Consumer Price Index as a general measure. Your personal inflation rate depends on what you actually buy — housing, healthcare and education have historically moved differently from the overall index — so the tool treats the result as a general benchmark.
Conventions used sitewide
- Rates are nominal annual rates unless a page says otherwise, and are divided by 12 for monthly calculations.
- Payments are made at the end of each period unless a tool explicitly offers beginning-of-period contributions.
- Currency is US dollars. The site uses US institutions and rules; figures for other countries will differ.
- Assumed values are labelled. Where a rate or fee is a typical value rather than something you entered, the page says so.
- Rounding is for display. Calculations use full precision and round only at the point of output, so displayed components may not add to the displayed total by a cent.
Testing
Each calculator is checked against a hand-computed worked example on its page before publication, and re-checked whenever the page content changes. The worked example on a page is generated from the same inputs the calculator defaults to, so a discrepancy is visible immediately.
Known limitations
These tools model financial mechanics; they do not model your life. They do not account for credit score, underwriting decisions, lender-specific fees, tax credits and phase-outs, state and local taxes, investment expenses, or behavioural risk. Each page lists the limitations specific to that tool. See also the disclaimer.
Questions
If you want the derivation behind a particular figure, or you think a formula is wrong, write to reportpilot.team@gmail.com.