Buying guide for best financial calculators
Whether you’re enrolling in a business class, taking a financial certification standardized test, or calculating payments on a loan, a financial calculator is a tool you’ll need.
A financial calculator can perform simple mathematical calculations like any handheld calculator. However, it can also calculate things like compound interest payments and rate conversions. It has extra keys to help you make these complex calculations quickly and efficiently.
If you’ve used a scientific calculator in the past, a financial calculator will look familiar to you. Both types of calculators are handheld devices that fit in the palm of your hand. They have small keys that are marked with the functions they provide. A monochrome display screen across the top shows both numbers and letters.
To find the best financial calculator for your situation, it helps to understand the various functions these units can perform. In this buying guide, we outline some of the key items to consider when shopping for a financial calculator.
Key considerations
Here are some high-level items to consider when shopping for a financial calculator.
Plans for use
For those who only need a calculator for an entry-level financial class or calculating simple loan terms, a basic financial calculator works nicely. These units often will offer time value of money (TVM) calculations. However, they often will not perform reverse Polish notation (RPN) calculations.
Finance professionals will need a high-end model capable of performing complex calculations. Certain financial classes also require a calculator with advanced functionality.
Usage limitations
If you plan to use your financial calculator for an advanced college course or for a financial certification exam, only certain models will have the capability you require.
For example, with the CFP exam, you cannot use scientific graphing calculators. (These models often also can perform financial calculations.) Instead, you must use a financial calculator. However, the CFP exam rules don’t specify an exact model you must use.
For college courses or for certification exams like the CFA, you often must use a particular model of financial calculator. Always check with the entity administering the exam or with the course’s professor to figure out whether you need an exact model.
"Some financial calculators refer to the data stored in memory as a register. "
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Features
The following features help set the financial calculators on the market apart from each other so you can decide which fits your needs.
Functions
Powerful financial calculators carry a large number of built-in functions, perhaps 200 or more. But you will pay a higher price for this style of calculator. Even basic will carry at least 50 built-in functions.
Power
The majority of financial calculators run on battery power — usually round, coin-style batteries. Some offer a solar power option, too, using the battery as a backup when light isn’t available. The ease of replacing a battery varies from model to model, as does battery life. The majority of calculator batteries last one to five years, depending on frequency of use.
Display
The LCD screen on a financial calculator isn’t measured in size as it would be for, say, a smartphone screen. Instead, it’s measured in the number of characters and lines it can display at one time. Having dozens of characters visible simplifies the process of calculating complex equations.
Storage
Financial calculators have a bit of internal memory storage. This allows you to store data as you’re entering and using it. It also stores programming changes that you’ve made to the unit. A calculator with 12 to 20 kilobytes of memory is above average.
Portability
For those who need to perform financial calculations on the go, a calculator is a smart choice, as it fits in the palm of a hand. Some prefer a vertically aligned calculator; others prefer horizontally aligned units.
Currency and unit conversions
For financial planners who work in multiple currencies, having a financial calculator that can adjust to the current currency is important. This feature often is limited to expensive models.
Extra features
Certain models of financial calculators are able to operate an alarm, remind you of appointments, and create reminder lists.
Financial calculator prices
The least-expensive financial calculators cost between $20 and $40. These will do basic work very nicely, but they don’t usually have extra features, such as multi-line display screens or the ability to track appointments.
Pricier financial calculators run in the $40 to $70 range. These carry additional financial functions and extra memory compared to the less expensive models.
You could pay up to $100 for a financial calculator. Some of these higher-priced models have advanced scientific calculating and graphing functions. However, if you’re buying the calculator for a class or a test, there may be some limitations on the type of calculator you can use. Graphing calculators aren’t always allowed for standardized testing purposes.
Tips
Some people can get the functionality they need from a basic calculator or spreadsheet. Others will definitely need a financial calculator. Here are some reasons why you might the latter.
- To calculate time value of money equations, you need a financial calculator. The majority of people using financial calculators work with this type of equation. All financial calculators can perform this function quickly with the press of a single key, outperforming other options.
- To solve equations for future value, you need a financial calculator. You can perform calculations about how investments will grow over time based on different factors that you enter into the calculator.
- To calculate payment amounts based on compounding interest, you need a financial calculator. As long as you know how often the interest on a loan compounds, you can use your financial calculator to figure out upcoming payments in a hurry.
FAQ
Q. How do I know if a particular key has an alternate function?
A. The key’s label should tell you if it has an alternate function. It will have one label across the top section of the key and a second label on the bottom, possibly in different colors. Just press the function key on the calculator to activate the secondary function of the next key you press.
Q. What are some inexpensive options for replacing batteries in a financial calculator?
A. Using cheap battery replacement options is not recommended. For safety, always refer to the instructions for your particular brand of calculator when choosing replacement batteries. Some models will restrict the use of rechargeable batteries, for example. Failure to follow the instructions and use approved batteries could lead to hardware damage.
Q. Why does my financial calculator display periods as digit separators instead of commas?
A. These calculators display digit separators for four-digit and larger numbers. Because both commas and periods are used around the world as a separator character, most calculators can display either one. You can usually toggle the display between these two characters using a key on your calculator.
Q. I need both a scientific and financial calculator. Can I find the features of both in one unit?
A. You can, but only to a degree. Financial calculators are not good for graphing, and they can not make complex scientific and mathematical calculations. A high-end scientific calculator can make some financial calculations, but it won’t be as easy to use as a financial calculator. For basic needs, one calculator for both functions will work fine. But for advanced needs, you’re probably better served by two different calculators.
