Introduction to Financial Mathematics

Financial mathematics is the study of mathematical methods used in finance. It is essential for making informed financial decisions. In this article, we will explore key concepts in financial mathematics, including interest rates, loans, and investments.

Understanding Interest Rates

Interest rates are the cost of borrowing money or the return on investment. They can be fixed or variable and play a crucial role in personal finance. Understanding how interest rates work is essential for managing loans and savings.

Financial literacy is key to achieving financial independence.

Calculating Loan Payments

To calculate loan payments, you can use the formula for an amortizing loan. This helps you understand how much you will pay over time and the total interest involved.