By Matthew Buonopane
This is a guide for CFA exam candidate users of the HP12C calculator. If you're a user of the Texas Instruments BA II Plus, you can read our howto guide here.
Although Reverse Polish Notation (RPN)  the HP12C’s language  may initially take some getting used to, it offers some advantages over nonRPN devices. Once you’ve developed basic knowledge of RPN, you may find its format more practical particularly for TVM problems on the exams.
To illustrate its value, this guide features a list of several fundamental uses followed by 2 basic examples of how the calculator’s financial operators work, along with some useful tips for operating the HP12C calculator.
This is a guide for CFA exam candidate users of the HP12C calculator. If you're a user of the Texas Instruments BA II Plus, you can read our howto guide here.
Although Reverse Polish Notation (RPN)  the HP12C’s language  may initially take some getting used to, it offers some advantages over nonRPN devices. Once you’ve developed basic knowledge of RPN, you may find its format more practical particularly for TVM problems on the exams.
To illustrate its value, this guide features a list of several fundamental uses followed by 2 basic examples of how the calculator’s financial operators work, along with some useful tips for operating the HP12C calculator.
If you have yet to get your HP12C calculator, you can view and get the latest models on Amazon:
Here's a quick overview of what I'm going to cover in this HP12C guide:

How To Use HP12C: Basic Functions You Should Know
 Setting Decimal Places
 Arithmetic Functions
 Clearing the Display
 Parantheses (or Brackets)
 Percentage Differential
 Storing Numbers
 Change Sign
 Resetting to Factory Settings

HP12C Examples: Using Key Financial Functions
 Future Value of An Ordinary Annuity
 Present Value of Uneven Cashflows
 Using HP12C: General Tips & Advice
How To Use HP12C: Basic Functions You Should Know
1) Setting Decimal Places
By default, the HP12C will show only two decimals places. To modify the number of places displayed, hit the yellow [f] prefix key followed by the number of places you wish to display. For example, to display five decimal places, you would key:
The yellow [f] as well as the blue [g] key will be used quite often as they allow you to access many of the important functions available on the HP12C.
2) Arithmetic Functions
Reverse Polish Notation requires that when performing arithmetic functions, you separate the first two numbers by hitting the [Enter] key. For example, to sum 5 and 5, you would key:
To add subsequent numbers (or use any other arithmetic operator), it is not necessary to use [Enter]. For example, performing the above operation will display 10 on the calculator. To continue adding 5 you would key:
3) Clearing the Display
There are six Clear keys on the HP12C  their specific functions are listed below.
4) Parentheses (Or Brackets)
To perform a calculation requiring parenthesis such as: (3 + 4) x (5 + 6), you would key the following:
Begin with the first parenthesis’ calculation:
Begin with the first parenthesis’ calculation:
Then key the second parenthesis’ calculation:
Then key [x]. The HP12C will display 77 (which is the first result, 7, multiplied by the second result, 11):
5) Percentage Differential
The HP12C has a key for calculating percent change between two numbers.
For example – let's calculate by what percent is 5 greater than 4:
For example – let's calculate by what percent is 5 greater than 4:
6) Storing Numbers
The HP12C allows you to store numbers using the following key strokes:
Key in the value that you wish to store (unless the value is already displayed on the screen). We will use 1,234 in the example below. Key [STO] followed by the storage register (0 – 9) that you wish to store your value in:
Key in the value that you wish to store (unless the value is already displayed on the screen). We will use 1,234 in the example below. Key [STO] followed by the storage register (0 – 9) that you wish to store your value in:
To recall a stored value, press [RCL] followed by the register (0 – 9) where your value was stored:
Note: Hitting [f] REG will clear the storage registers. You may also overwrite a single stored register by storing a new value in the register.
7) Change Sign
To indicate a negative number, or change a negative number to a positive one, we use the [CHS] key:
8) Resetting to Factory Settings
If you wish to reset your HP12C to factory settings, you may do so by keying the following:
 Turn the calculator off.
 Hold the subtract button while simultaneously turning the calculator back on. The HP12C will display PR ERROR  this is normal.
 Release the subtract button and then turn the calculator off.
 Upon turning the calculator back on, the HP12C should now be reset to factory settings.
HP12C Examples: Using Key Financial Functions
A strength of the HP12C is its intuitiveness for completing TVM calculations. The five keys in the top left corner (including their [f] and [g] functions) are all used for these types of problems.
1) Future Value of an Ordinary Annuity
Example: You open a savings account with an initial $775 deposit. The savings account will pay 2% compounded monthly. Beginning next month, you intend to make monthly deposits of $50 for the next five years. What will your deposit account be worth in five years?
First, press [CLx] followed by [f] FIN to clear the screen and financial registers.
First, press [CLx] followed by [f] FIN to clear the screen and financial registers.
Enter the annual interest rate, 2, followed by [g] 12÷ to convert to the monthly rate and automatically store the value.
Enter the initial deposit: 775 [CHS] [PV]
Enter your monthly payments: 50 [CHS] [PMT]
Enter the number of years, 5, followed by [g] 12x to convert to monthly periods and automatically store the value
To calculate the future value of the savings account, hit [FV]. The HP12C will display 4,008.80:
Notes about the above example:
 You can input these values in any order  it’s irrelevant what order you enter the above inputs prior to calculating FV.
 If a TVM problem uses monthly compounding as was the case in the above example, the HP12C has keys which make the calculation more convenient:
 To calculate and store the number of periods with monthly compounding, key the number of years followed by [g] 12x.
 To calculate and store the interest rate with monthly compounding, key in the annual interest rate followed by [g] 12÷. Note that the HP12C automatically converts the interest rate to a decimal.
 If a problem uses annual compounding, all that is necessary is to key in the number of years or annual interest rate followed by [n] or [i], respectively.
2) Present Value of Uneven Cash Flows
Example: You will receive $150 in Year 1, $80 in Year 2, $90 in Year 3, $100 in Year 4 and $110 in Year 5. The required rate of return is 10%. The initial investment will be $400. What is the NPV of these cash flows?
First, press [CLx] followed by [f] FIN to clear the screen and financial registers.
First, press [CLx] followed by [f] FIN to clear the screen and financial registers.
Enter the initial investment, 400 [CHS] followed by [g] CF0:
Enter the yearly cash flows, followed by [g] CFj each time:
Enter the required rate of return, 10, followed by [i]
Enter [f] NPV which will display 6.70.
In the above example, if you wished to find the IRR, you would key [f] IRR instead of [f] NPV after entering all cash flows. Remember to use correct cash flow sign conventions be used (use opposing signs when cash is flowing in vs out), otherwise your answer will not make sense!
Using HP12C: General Tips & Advice
 Always ensure that you’ve correctly set your calculator to either beginning or end of period based on when cash flows occur. Beginning will be identified on the screen, end will not. To switch to beginning mode, use the following keystrokes [g] BEG
 If you accidentally key the [f] or [g] prefix, you may cancel it by pressing [CLx].
 Be aware, unless you’re using the Platinum edition HP12C, there is no Backspace key.
 It’s helpful to draw up a cash flow timeline when using your HP12C for Time Value of Money calculations.
 Once you have solved a TVM problem using the HP12C, as with any type of calculator or Excel, it’s helpful to perform a quick sanity check by giving the answer a second look to be certain it makes sense.
Hope these set of tips will get you to a flying start with your HP12C calculator. If you'd like to see more, let us know in the comments below!