Bond Calculator

What the Inputs Mean

• Face / par value: what you pay for the bond, the amount the interest is calculated on.
• Maturity value: what the issuer pays you back when the bond comes due.
• Coupon rate: the annual interest rate the bond pays, as a percentage of face value.
• Months to maturity: how long until the bond pays out its maturity value.

What the Results Mean

• Total yield: every dollar the bond produces, all the coupon payments plus any gain between what you paid and the maturity value.
• Yield to maturity: the approximate annual return you earn if you hold the bond until it matures.
• Annualized yield: the total yield spread evenly across each year you hold the bond.
• Percentage yield: the total yield as a percentage of what you put in.

Why Bonds?

Bonds are the steadier side of an investment portfolio: you lend money to a government or company, they pay you interest along the way, and you get your principal back at maturity. They won't make you rich overnight, but they can smooth out the ride, and knowing exactly what a bond will produce before you buy is half the battle.