Methodology

Formulas and limitations.

Results are scenarios, not quotes or advice. Day-count conventions, payment dates, fees, rounding, taxes and real market returns can materially change actual outcomes.

Compound growth with recurring contributions

The annual input rate is divided by 12. Each month, the contribution is added before that month's return is applied, making the model similar to beginning-of-month contributions. Taxes, fees, variable returns and inflation are excluded.

Equal-payment loan

The calculator uses the common fixed monthly-rate annuity formula. When the rate is zero, principal is divided by the number of months. Real lenders may use different dates, day counts, fees and rounding.

Equal-principal loan

Principal is divided evenly across all months, and monthly interest is applied to the remaining balance. The first payment is normally the largest and declines as the balance falls.

Savings interest after-tax example

One year of simple interest is calculated as principal × annual rate. A user-entered illustrative tax percentage is then deducted from interest. The default rate is not a universal legal rate; enter the rate relevant to your product and current rules.

Withdrawal-rate target

The target equals monthly spending × 12 ÷ withdrawal rate. A value such as 4% is only a historical starting assumption and does not model future returns, inflation, tax, retirement length, asset allocation or sequence-of-returns risk.

Currency display

Currency selection changes formatting and example values only. Live exchange rates and conversion costs are not included.

Validation

Tests cover zero rates, zero contributions, short terms, large values, blank inputs and invalid withdrawal rates. Compound totals are checked against contributed principal and calculated growth. Loan schedules are checked for balance reduction and interest totals.

Production disclosure

AI assistance may support implementation drafts and wording. Jisung Kim reviews formulas, boundary tests and published explanations. This page documents software behaviour; it is not a financial advisory report.