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Tag: FV function

FV function: Description, Usage, Syntax, Examples and Explanation

What is FV function in Excel? FV function is one of the Financial functions in Microsoft Excel that calculates the future value of an investment based on a constant interest rate. You can use FV with either periodic, constant payments, or a single lump sum payment. Syntax of FV function FV(rate,nper,pmt,[pv],[type]) For a more complete description of the arguments in FV…

How to calculate annual compound interest schedule in Excel

To calculate annual compound interest, you can use a formula based on the starting balance and annual interest rate. Formula =start+(start*rate) Explanation In the example shown, the formula in C6 is: =C5+(C5*rate) Note: “rate” is the named range F6. How this formula works If you have an annual interest rate, and a starting balance you can calculate interest  with: =balance…

How to calculate compound interest in Excel

To calculate compound interest in Excel, you can use the FV function. Case study: This example assumes that $1000 is invested for 10 years at an annual interest rate of 5%, compounded monthly. Formula =FV(rate,nper,pmt,pv) Explanation In the example shown, the formula in C10 is: =FV(C6/C8,C7*C8,0,-C5) How this formula works The FV function can calculate compound interest and return the future…

PMT, RATE, NPER, PV and FV Financial Functions in Excel

Learn all about Excel’s PMT, RATE, NPER, PV and FV To illustrate Excel’s most popular financial functions, we consider a loan with monthly payments, an annual interest rate of 6%, a 20-year duration, a present value of $150,000 (amount borrowed) and a future value of 0 (that’s what you hope to achieve when you pay off a loan). We make monthly payments, so we use 6%/12 =…