Thread: Future value of investment (Excel 2003-7)

1. Future value of investment (Excel 2003-7)

Hi, (Long time no visite )

I am aware of the FV function that works out the future value of an investment that has frequent payments over a set time at a set interest rate. However, I was asked recently to help work out a future value of a set (fixed) amount that would be invested for 3 years at a set interest rate. I am not a fundie when it comes to finances...could someone please help me with a formula (or excel function) to work out the extra interest earned based on this amount over the 3 years.

Hope this is clear...

TX

2. Re: Future value of investment (Excel 2003-7)

Hi Rudi

Good to see you about again.

As usual I have no hands on experience with this but I turned uo a PDF which I hope can hep you http://www-personal.umich.edu/~kathrynd/Us...ncialWizard.pdf

Cheers

Steve

3. Re: Future value of investment (Excel 2003-7)

Hello Rudi,
Wouldn't that be equal to omit the Pmt and only use Rate, Nper and Present value in the FV function?

I.e.
Rate: 10 % / year
Nper: 2 years
Pv: 100

FV=100*(1+0.10)^2=121
Three years:
FV=100*(1+0.10)^3=133.1 etc.

In the Excel function PV, Present Value, must be entered as a negative number, since it is an investment (cash flow out) and you expect to receive the future value (cash flow in).

Just remember that Rate and Nper must correspond with each other.

4. Re: Future value of investment (Excel 2003-7)

Hi Steve and Argus,

TX for the reply. Argus, I eventually replied to the request by "unwittingly" providing the advice you are giving...so hopefully my reply was not too far off as you are 'confirming' my reply.

I did use the FV function...like this:

=FV(10%, 3yrs, 0, invested amount)

Hopefully this is correct!

TX again!

5. Re: Future value of investment (Excel 2003-7)

Hi Rudi

In Excel, FV(rate,n,pmt,pv).
See attached.

6. Re: Future value of investment (Excel 2003-7)

TX Franciz, this seems to be the general answer. I have used the FV function before, but never knew it had this PV argument that could be used for a lump sum investment. Its great.

Cheers

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