How We Compute Numbers
The formulas, assumptions, and data sources behind every Credit Calculator tool.
Loan and mortgage payment formula
All loan and mortgage payment calculations use the standard amortization formula:
M = P x [r(1+r)^n] / [(1+r)^n - 1]- M = monthly payment
- P = principal (loan amount)
- r = monthly interest rate (annual rate divided by 12)
- n = total number of payments (loan term in years multiplied by 12)
This is the same formula any bank or lender uses. In calculators where it is relevant, we add property tax, homeowners insurance, and PMI on top of the base payment to show the true all-in monthly cost.
Compound interest and investment growth
For lump-sum investments we use the future value formula:
FV = P x (1 + r/n)^(n x t)- FV = future value
- P = principal
- r = annual interest rate (as a decimal)
- n = number of compounding periods per year
- t = time in years
For regular periodic contributions, we add the future value of an annuity formula to model recurring deposits.
Important limitation: We do not model market volatility, sequence-of-returns risk, or investment fees beyond what you input. Real investment returns vary significantly from year to year. These tools show you what growth looks like at a steady assumed rate, which is useful for planning but not a prediction.
Tax and paycheck calculations
Federal income tax: We apply the 2026 IRS Publication 17 tax brackets for single, married filing jointly, and head of household filing statuses. The standard deduction is applied by default; we do not model itemized deductions.
FICA taxes: Social Security is withheld at 6.2% up to the 2026 wage base of $168,600 (per SSA). Medicare is withheld at 1.45% on all wages, plus an additional 0.9% on wages above $200,000 for single filers or $250,000 for married filing jointly.
State income tax: We use 2026 published rates for each state. Local and city taxes (such as New York City or Philadelphia) are not fully modeled in all tools.
Employment type: We assume standard W-2 employment unless noted. Self-employment tax (15.3% SECA) is handled in specific tools where it is relevant.
Mortgage state-specific data
Property tax rates: State-published effective property tax rates as of 2026.
Median home values: Latest FHFA HPI data, rounded for clarity and readability. Broader market context from the Federal Reserve.
Insurance defaults: State averages derived from public regulatory filings. Your actual insurance quote will vary based on your home, location, coverage level, and insurer.
The state-specific mortgage pages are a starting point for your local research. They are not a substitute for a real quote from a lender or insurer.
Tipping by country
Tipping norms and cultural guidance are compiled from US State Department travel resources, OECD travel norms, and widely recognized tipping etiquette sources. Currency symbols and codes follow the ISO 4217 standard.
Tipping customs shift over time and can vary within a country by city and establishment type. We review this content annually, but always verify local custom on arrival.
Update cadence
- Annually (January):Federal tax brackets, FICA wage bases, and retirement contribution limits, updated when the IRS publishes new figures.
- Quarterly:State-specific property tax rates, home values, and insurance averages.
- Stable:Loan and mortgage formulas do not depend on market rates. You input the rate, and the formula does not change.
What this site is not
- Not a substitute for a CPA, CFP, or fiduciary advisor for personalized financial planning.
- Not a real-time rate aggregator. We do not pull live mortgage rates, savings rates, or market data.
- Not a credit decisioning service. We do not perform soft pulls, access your credit file, or calculate your FICO score from your inputs.
Editorial team
Credit Calculator is maintained by an independent editorial team. Our content is researched against primary government sources (IRS, HMRC, CRA, SAT) and reviewed annually. We are not licensed financial advisors; this site is a tool for understanding the math behind your money decisions. For personalized advice, work with a CFP or fiduciary.
Questions or corrections?