Getting comfortable with a Financial Calculator is absolutely critical for anyone that is preparing for the CFP Board Examination. The Bryant CFP Program curriculum teaches to the HP 12c Financial Calculator, so in my capacity as a Student Advisor I find myself helping many students get up to speed on the nuances of the 12c. The Boston Institute of Finance has also created a few helpful YouTube videos to help students learn the HP 12c...  Calculator Basics, Finding Interest and Finding PMTs.

Each of the 5 questions below contains a concept that is often misunderstood by new students. Click here for Answers, Explanations and HP 12c Keystrokes. I find that once students understand the underlying concepts they can easily spot pitfalls and traps. The explanations are written to help you conceptualize the variables and then properly input them into the HP 12c. Read them closely!

1. Trevor purchased an investment for \$25,000. He expects it will increase in value at a rate of 10% compounded annually for the next 5 years. If his expectations are correct how much will his investment be worth at the end of the 5th year?

2. You are offered a \$105,000 mortgage at an annual interest rate of 7.3% compounded monthly. How much must you pay each month to completely repay the loan in 30 years?

3. Abby’s grandmother invests \$1,000 into a mutual fund for Abby on the day she is born. The fund is remarkably consistent and earns 2.3% annually. How much will the fund be worth when Abby’s grandmother gifts her the fund on her 18th birthday?

4. David’s goal is to become a millionaire by the time he is 40 years old. On his 25th birthday he decided to make a plan to reach his goal. If he already has \$50,000 in an investment returning 7% annually, how much must he contribute at the beginning of each month to reach his goal by his 40th birthday?

5. Kiesha has been investing \$2,000 at the end of each year for the past 11 years to make a down payment on a vacation home. Assuming she has earned 8% compounded annually on her investments, how much does she have saved today?