Last reviewed November 15, 2026.
Our approach
Every calculator uses the standard formula for its job, the same one found in finance textbooks and used by lenders and analysts. We do not invent our own methods. Each calculator page prints its formula, defines every variable and shows a worked example produced by the calculator itself, so you can check the result by hand.
Conventions we use
| Area | Convention |
|---|---|
| Loan payments | Fixed-rate, fully amortizing, paid monthly. Monthly rate is the yearly rate divided by 12. Payments are made at the end of each month. |
| Amortization | Simulated month by month. Each payment covers that month's interest first, and the rest reduces the balance. Extra payments go straight to principal. |
| APR | The yearly rate that makes the scheduled payments repay the amount actually received after upfront fees. Solved numerically to better than a thousandth of a percent. |
| Compound growth | The stated yearly rate is converted to an equivalent monthly rate for the chosen compounding frequency. Contributions are added at the end of each month. |
| Inflation and discounting | Compounded once a year: value ÷ (1 + rate)years. |
| NPV and IRR | Cash flows arrive at the end of each year. The initial investment is at year 0 and is not discounted. IRR is the rate at which NPV equals zero, solved numerically. |
| Home affordability | The lower of 28% of gross monthly income for housing and 36% for all debts. These are common rules of thumb and vary by lender. |
| Rounding | All maths runs at full floating-point precision. Only the displayed result is rounded: to the cent below 10,000 and to the whole unit above. |
How we test
- Independent re-calculation. Every calculator is checked against a second implementation written separately from first principles. The current suite runs 7,373 cases across all 33 calculators: default inputs, textbook answers, edge cases and 200 random input sets per calculator.
- Known answers. Results are compared with textbook cases, for example a $200,000 loan at 6% over 30 years costing $1,199.10 a month.
- Edge cases. A zero interest rate, a payment too small to cover interest, a single-year term and negative cash flows must all return a sensible answer or a clear message, never an error.
- Consistency. Principal plus interest must equal the total paid, a schedule must end at a zero balance, and every chart and table must agree with the headline number.
The test suite is rerun whenever a formula changes.
What the calculators leave out
The tools cannot see your tax position, credit profile, lender-specific fees or future market returns. They assume rates stay fixed and payments are made on time. Treat results as estimates for planning and comparison, and confirm exact figures with your lender or adviser.
Report a problem
If a result looks wrong, email hello@capitalcalculators.com with the page, your inputs and the result you expected. Confirmed errors are corrected and the correction date is shown on the page.