Coaching Centre
Chapter 3: Annuities and Loans Notes
Reducing-balance loans in tables and spreadsheets, extra repayments, repayment frequency and offset accounts, credit cards with compound daily interest, annuities as recurrence relations, and future value and present value interest factor tables for savings, loans and superannuation.
Sections
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3A Reducing-balance loans Mastered
How a reducing-balance loan works month by month, building a loan table with interest and repayments, the recurrence relation for the balance, and total repayments and total interest.
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3B Loan spreadsheets, extra repayments and offsets Mastered
Building a loan schedule in a spreadsheet, the PMT function, and how extra repayments, fortnightly repayments and offset accounts reduce the time and interest on a home loan.
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3C Credit cards, statements and fees Mastered
Credit card interest compounded daily, reading a monthly statement, minimum repayments and why paying only the minimum takes so long, and the fees charged on credit cards.
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3D Annuities as recurrence relations Mastered
What an annuity is, modelling regular contributions with the recurrence relation A(n+1) = A(n)(1 + r) + P, building annuity tables and spreadsheets, and superannuation as an annuity.
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3E Future value interest factor tables Mastered
Using a table of future value interest factors to find the future value of an annuity, and working backwards to find the regular contribution needed to reach a savings goal.
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3F Present value tables, loans and superannuation Mastered
Present value interest factor tables, finding loan repayments and how much can be borrowed, and using present value to plan retirement income from superannuation.