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The financial calculator is a very important tool to use as a real estate note investor. Note investors should become familiar with the financial calculator, to be able to accurately calculate note investment returns. Many investors are intimidated by financial calculators like the HP-12C or the Texas Instruments BA II Plus. Here we will help you start to conquer the calculator and boost your financial calculator game.
NASA's Human Calculators
Fun factoid in the 1940’s, before the dawn of computers, NASA had employees whose single job was to compute trajectories by hand. Pretty crazy to think about when we all have calculators on our smartphones now.
My Experience Using Financial Calculators
With a bachelor’s degree in finance, I have spent a fair amount of time plugging numbers into financial calculators to find returns, payment amounts and interest rates. I remember what it was like when I first started using my Texas Instruments BA II Plus in my finance classes. I eventually graduated to the HP-12C, which is slightly trickier because it uses Reverse Polish Notation (RPN) in its calculations. While I’ve used both of the financial calculators below, I prefer the HP-12C due to its design as well as finishes.
Recommended Financial Calculators
The BA II Plus was my first financial calculator and always performed well throughout college. It is capable of solving all of the financial calculations required as a note investor, such as time-value-of-money, cash flow analysis, amortization schedule generation, Internal Rate of Return (IRR) and Net Present Value (NPV). The BA II Plus operates most closely to simple function calculators, so it should be easier to familiarize yourself.
My personal go to calculator is the HP-12C. Like the BA II Plus, it performs all necessary financial calculations that would be desired from a real estate note investor. Uniquely, the HP-12C computations are in Reverse Polish Notation (RPN), which may lead to some confusion when first using the calculator. Aesthetically the HP-12C feels premium and refined compared to the BA II Plus, which is reflected in the slightly higher price. For the higher price, I feel that it is justified the premium craftsmanship alone.
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