Calculating balance and monthly payments in Python loop

Question

balance = 4213
annualInterestRate = 0.2
monthlyPaymentRate =0.04
monthInterestRate = annualInterestRate / 12
monthlyPayment = (monthlyPaymentRate*balance)
newBalance= (balance-monthlyPayment) * (1 + monthInterestRate)
month = 0
while month < 12:
    month += 1
    newBalance=(balance-monthlyPayment)*(1 + monthInterestRate)
    balance = newBalance
    monthlyPayment = (monthlyPaymentRate*newBalance)

    print ("Month: " + str(month))
    print ("Minimum monthly payment: " + str(round(monthlyPayment,2)))
    print ("Remaining balance: " + str(round(newBalance, 2)))

So, I have the code above and I'm trying to make it display the below output:

Month: 1
Minimum monthly payment: 168.52
Remaining balance: 4111.89
Month: 2
Minimum monthly payment: 164.48
Remaining balance: 4013.2
Month: 3
Minimum monthly payment: 160.53
Remaining balance: 3916.89
Month: 4
Minimum monthly payment: 156.68
Remaining balance: 3822.88
Month: 5
Minimum monthly payment: 152.92
Remaining balance: 3731.13
Month: 6
Minimum monthly payment: 149.25
Remaining balance: 3641.58
Month: 7
Minimum monthly payment: 145.66
Remaining balance: 3554.19
Month: 8
Minimum monthly payment: 142.17
Remaining balance: 3468.89
Month: 9
Minimum monthly payment: 138.76
Remaining balance: 3385.63
Month: 10
Minimum monthly payment: 135.43
Remaining balance: 3304.38
Month: 11
Minimum monthly payment: 132.18
Remaining balance: 3225.07
Month: 12
Minimum monthly payment: 129.0
Remaining balance: 3147.67
Total paid: 1775.55
Remaining balance: 3147.67

And for some reason I keep getting the below result instead of the above... Can someone please point me to what I'm doing wrong? Thank you very much!

Month: 1
Minimum monthly payment: 164.48
Remaining balance: 4111.89
Month: 2
Minimum monthly payment: 160.53
Remaining balance: 4013.2
Month: 3
Minimum monthly payment: 156.68
Remaining balance: 3916.89
Month: 4
Minimum monthly payment: 152.92
Remaining balance: 3822.88
Month: 5
Minimum monthly payment: 149.25
Remaining balance: 3731.13
Month: 6
Minimum monthly payment: 145.66
Remaining balance: 3641.58
Month: 7
Minimum monthly payment: 142.17
Remaining balance: 3554.19
Month: 8
Minimum monthly payment: 138.76
Remaining balance: 3468.89
Month: 9
Minimum monthly payment: 135.43
Remaining balance: 3385.63
Month: 10
Minimum monthly payment: 132.18
Remaining balance: 3304.38
Month: 11
Minimum monthly payment: 129.0
Remaining balance: 3225.07
Month: 12
Minimum monthly payment: 125.91
Remaining balance: 3147.67

Solution 1

The problem in your algorithm was that monthly payment was calculated based on the new balance.

A few points about your Python code:

1- use underlines instead of camelCase when coding in python

2- make use of string formatting instead of str() when printing

3- for is a better choice than while here

4- no need to overuse parenthesis when they are not needed

balance = 4213
annual_interest_rate = 0.2
monthly_payment_rate =0.04
monthly_interest_rate = annual_interest_rate / 12
monthly_payment = monthly_payment_rate * balance
new_balance= (balance - monthly_payment) * (1 + monthly_interest_rate)

for month in range(1, 13):
    monthly_payment = monthly_payment_rate * balance
    balance = (balance - monthly_payment) * (1 + monthly_interest_rate)

    print('Month: %d \n Minimum monthly payment: %g \n Remaining balance: %g'\
          % (month, round(monthly_payment, 2), round(balance,2)))

Solution 2

Consider the order of the statements in the while loop.

Solution 3

Your monthly payment is one month off.

In your calculation, the monthly payment (monthlyPayment) is calculated based on the new balance (newBalance) or after you made the payment.

Comments

[Lee Taylor]

Please explain your answer.

[Adam Gent]

Although it works for the given numbers that monthly interest rate calculation could cause rounding errors. Use decimals datatypes when dealing with money.