Methodology

Updated June 2026

We publish the exact math behind every calculator so you can check our work. No black boxes. All calculations run in your browser — we never see your inputs.

Last updated: 2026-06-02

Notation

• P — principal or starting balance
• C — recurring contribution or payment per period
• r — periodic interest rate (annual rate ÷ periods per year)
• n — total number of periods

Unless stated otherwise, our calculators use monthly periods, so r = annual rate ÷ 12 and n = years × 12.

Compound interest & future value

The future value of a starting balance plus a contribution made at the end of each period (an ordinary annuity) is:

When the rate is zero we fall back to FV = P + C·n. This powers the compound interest and savings goal calculators. The savings-goal tool rearranges the same equation to solve for the contribution C needed to reach a target.

Loan payment & amortization

The fixed payment that fully amortizes a loan is:

We then build the schedule period by period: each period's interest is balance × r, the rest of the payment reduces principal, and any extra payment is applied directly to principal. The final payment is trimmed so the balance never goes below zero. This drives the loan and mortgage payoff calculators. "Interest saved" from extra payments is simply the total interest of the baseline schedule minus the total interest of the accelerated schedule.

Debt snowball vs avalanche

The debt payoff tool simulates your debts month by month. Each month we (1) accrue interest on every remaining balance, (2) pay each debt's minimum, then (3) apply a "snowball pool" — your extra payment plus the freed-up minimums of any debts already cleared — to the highest-priority remaining debt.

• Avalanche orders debts by highest interest rate first — this mathematically minimizes total interest.
• Snowball orders debts by smallest balance first — this clears individual debts soonest for motivation.

We compare total interest and months-to-debt-free for both. If your payments don't cover the interest, the tool tells you instead of looping forever.

FIRE number & years to independence

The FIRE calculator uses the safe-withdrawal-rate rule:

The 4% guideline comes from the Trinity study and is a rule of thumb, not a guarantee. We project your invested assets forward month by month at your chosen real (after-inflation) return plus contributions, and count the months until the balance reaches your FIRE number.

Rent vs buy

The rent vs buy tool compares the net cost of each path over the years you plan to stay. Buying accounts for the down payment, mortgage interest, ongoing costs (taxes, insurance, maintenance as a % of value), and transaction costs, offset by the equity and appreciation you keep when you sell. Renting accounts for rent (growing each year) offset by investment growth on the cash you didn't tie up in a down payment. It is a deliberately simplified model — it does not model income-tax deductions or local specifics — so treat the result as directional.

Salary ↔ hourly

The pay converter normalizes any input to an annual figure using your hours-per-week and weeks-per-year, then derives the hourly, daily, weekly, bi-weekly and monthly equivalents. All figures are gross (before tax).

Rounding & accuracy

We compute with full floating-point precision and round only for display. Tiny differences versus your lender or brokerage can occur because institutions may use different day-count conventions, compounding frequencies, or fees. When in doubt, your provider's official figures take precedence.

Found a problem?

We take accuracy seriously. If a number looks off, tell us — include the inputs you used and we'll investigate.