Archive for March, 2012

Math is an essential tool in the world of finance

Math skills are essential to maintaining financial viability.  In today’s credit-crazy society, it is easy to become lost in the convoluted world of variable interest rates, compounding payment schedules and minimum payment allowances.  Most people have no way to break down the numbers to understand the methodology behind them.  The rules are designed to be hard to understand.  A bankruptcy lawyer is equipped to examine your financial portfolio to determine your best course of action when faced with monetary difficulties.

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The ability to apply math to everyday situations is not something that comes naturally to most people.  Rather, it is necessary to practice a commonsense approach to educate yourself on the necessary topics.  A comprehensive fiscal and mathematical vocabulary is essential for navigation of the complex legal and fiduciary environment that we find ourselves in today.  Without adequate preparation, hard work and dedication can go to waste.  In understanding everything there is to know about financial responsibility, bankruptcy attorneys learn to see all sides of an issue.  They are well-equipped to deal with the harsh realities of fiscal difficulties, yet they understand that at the heart of every distressed business or individual, there are families that are depending on fair disposition of circumstances.

Behind the numbers there are people who need solutions that work so that they can live their lives, not under the looming shadow of impending disaster, but in the light of hope for the future.  By assessing your financial portfolio and making statistically informed decisions, it is possible for even the most seemingly hopeless financial obstacle to be overcome.  Fully understanding the nature of debt requires complex analysis and calculation of debt tables, interest rate formulas, percentages, statistics and much more, along with a complete knowledge of the governmental policies and procedures.  Only bankruptcy attorneys are equipped with the math and other skills necessary to fully assess your financial situation and how to fix it.

Further Reading

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Maths in property

As a mathematics professor I have always found that shopping is the most arduous task in our society today. House closing rarely takes into account basic mathematical precision that would allow for easier agreements to be reached. It’s difficult to display exactly how frequently this occurs but I’ll do my best by telling you about my latest experience with house rental in the great state of Oklahoma.

When I was last searching for  houses to rent I came across a beautiful property and fell in love right away. It had everything I wanted. A Playroom for the kids, a swimming pool for the wife, and a fire pit for me.  All these thing we first read about in Skymall and, of course, wanted for ourselves. I drew the line at the replica sarcophagus coffee table.

We progress through many stages of meetings, after one month we were adjusting closing costs when my broker informs me,  the current owners were adjusting the price bye $5000 for furniture in the home. I made the argument a two part response. Firstly, I said I do not want your furniture. Secondly, it is inconceivable that your bed and sofa were worth $5000. I countered with the offer of individual pricing per item totaling somewhere around $1500. When they scoffed I had no problem walking away from the deal
Another example is when my brother purchased his very first home. It had to do with bills and receipts of previous tenants’ electricity and gas bills. When my brother moved in, he was billed immediately for a year is negligent payments. It took three weeks of e-mails and threatening letters to reach a resolution that did not cost my brother anything but his time. Very luckily for him. If a mathematics-based system could surplant the often arbitrary system we have today we would be much better off.

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The Mathematics Behind Compounding Interest

Compound Interest.  It can be your best friend (in your investment or savings account) and your greatest enemy (debt).  The mathematics behind how your money or debt compounds can be beautifully simplistic or complex depending on how you look at it.  For those of us interested in a simplistic, visual approach to understanding how it works, we have a great tool available to us known as a compound interest calculator.

Anyone would like to know how much interest he or she has to pay on a mortgage or a loan. You would also want to keep track of the amount of interest to pay over a given period of time if you are borrowing money. The simplest formula to use when calculating interest rate is P x(1 + r/n)^ Yn where P = principal, r = rate, n = number of times per year for interest compounding and Y = the number of years for the loan. Sometimes, it can be challenging to manually calculate the interest on a loan and you can also make mistakes. Instead of calculating manually, you can use a compound interest calculator to calculate your compound interest.

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With the compound interest calculator, you can know how much you shall have saved after a certain number of years and you can also know how much of your final balance is due to make more interest for you. The calculator is very easy to use. You just need to enter the needed information in the fields specified. You should enter your original deposit in the principal box, your APY in the Rate box and the length of time in the Years box. After inputting the information as required, you can then hit on calculate to get the results. You can either select to calculate your rate using months or years.

The compound interest calculator can be very important to both bankers and those holding savings accounts. Whether you are a lender or a borrower, you will find this tool very useful when it comes to keeping track of how much money you are earning or how much money you would have to pay on a loan.  Obviously there are differences based on your location but also most financial transactions are fairly standardized in the developed world – there are EU rules for example which control transactions in Europe.  It is an easy to use tool that does not need any special skills. You can find the software online. You can do all your calculations just sitting in front of your computer.

Financial management is something that some people take for granted and it can be very crucial when it comes to financial stability. You might be losing a lot of money without actually understanding how if you cannot track your savings properly. Compound calculators will make things very easy even for dummies. They can also be very useful when you need to determine a loan program to get if you are looking for a loan. When shopping around, you can use this calculator to compare the interest rates between the different lending companies before selecting which one to get.

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