Finance guides
Short, plain-English explanations of the ideas behind the calculators. Each one links to a tool so you can try the numbers yourself.
- How Compound Interest WorksLearn how compound interest works, how it differs from simple interest, the formula behind it, and how time, rate and frequency change the result.4 min read
- APR vs APY: What Is the Difference?APR and APY both describe a yearly rate, but only APY includes compounding. Learn how to convert between them and which to compare for loans and savings.4 min read
- How Loan Amortization WorksSee how a fixed loan payment is split between interest and principal, why early payments are mostly interest, and how extra payments shorten a loan.4 min read
- How Much House Can I Afford?Estimate a home budget using the 28/36 rule, debt-to-income, down payment, rate and term, plus taxes, insurance and upkeep. Includes a worked example.4 min read
- NPV vs IRR: What They Measure and When They DisagreeNPV measures value added in dollars and IRR measures a percentage return. Learn how each is calculated, where they disagree and which one to trust.4 min read
- What Is Working Capital?Working capital is current assets minus current liabilities. Learn the formula, the current ratio, the cash conversion cycle and ways to improve it.4 min read
- How to Calculate Your Break-Even PointLearn how to calculate the break-even point in units and revenue, with contribution margin, a worked example, a target profit version and key limits.4 min read
- Margin vs Markup: What Is the Difference?Margin and markup measure the same profit against different bases. See both formulas, one sale shown both ways, a conversion table and common mistakes.4 min read
- The Rule of 72 ExplainedThe Rule of 72 estimates how long money takes to double. Learn the formula, why it works, how accurate it is, and how to apply it to inflation and debt.4 min read
- Debt Snowball vs Debt AvalancheCompare the debt snowball and debt avalanche methods. See how each works, a side-by-side example, the cost versus motivation trade-off and how to start.4 min read
- What Is WACC (Weighted Average Cost of Capital)?WACC is the average rate a company pays for its capital. Learn the formula, cost of equity and debt, the tax shield, a worked example and its limits.4 min read
- How to Calculate ROI (Return on Investment)Learn how to calculate ROI with a simple formula and worked example, how to annualize it, how it compares with CAGR and IRR, and which mistakes to avoid.4 min read