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Thread: Grow Only Part

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    Grow Only Part

    I need to add a fixed amount to an amount that grows by 4% each year.

    For instance A1= 10,000 and A2 = 3,000

    The total in year 1 is 13,000 but in year 2 it is A1+ (A2*1.04). In year 3, its A1 + (A2*1.04*1.04)etc.

    Is there a function that would calculate this or do I just keep adding a *1.04 to each next year.
    <font face="Comic Sans MS"><big><font color=4682b4>Sherry</font color=4682b4></big></font face=comic>

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    Re: Grow Only Part

    If, in column B, you put the date that you start counting then:

    =IF(TODAY()-B2<365,$A$1,$A$1+$A$2*(YEAR(TODAY())-YEAR(B2)-1))

    should do it.

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    Re: Grow Only Part

    Thanks for the help but I think I wasn't too clear on what I was trying to do. I'm not concerned with calculating time but rather incrementing the sum of 2 cells by 4% each year while also adding a base amount. The formulas I am using for year 1, 2, and 3 are below. I'm thinking there is a function I could use that would treat the amount that is growing (cells D10-11) like an annuity that earns interest (4%) AND would also let me add on the base amount (cell D9)

    =SUM($D$10:$D$11)*1.04+SUM($D$9)
    =SUM($D$10:$D$11)*1.04*1.04+SUM($D$9)
    =SUM($D$10:$D$11)*1.04*1.04*1.04+SUM($D$9)

    While my formula works, it seems rather unsophisticated.
    <font face="Comic Sans MS"><big><font color=4682b4>Sherry</font color=4682b4></big></font face=comic>

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    Re: Grow Only Part

    Actually, I wasn't calculating the time. I was just finding how many year had elapsed from the time your process start and multiply that by your percentage increase. Do you try it?

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    Re: Grow Only Part

    In cell B2 enter the percentage growth you are planning for, and enter the annual contribution you are going to make.
    Leave row 4 blank and enter the following formula in cell B5. Copy the formula aas many rows down as you like - you could also place meaningful labels in column A - like 'growth,' 'contribution,' and the year.

    =B4 * (1 + $B$2) + $B$3

    It will be easier to understand in a month if you name the cells B2 and B3, and 'apply' names to the formulas in B5:B?

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    Re: Grow Only Part

    Sherry,

    One of Excel's math operators is the exponentiation operator. Simply put, it raises a number to a power. Even more simply put, it multiplies a number by itself until you've done it the number of times given by the power.

    For example, 2 to the power of 3 is 2x2x2=8.

    In Excel, you'd write a formula as 2^3 (the symbol between the 2 and the 3 is shift on the 6 key). This operator has even higher precedence than multiply * and divide /.

    Now applying this to your problem:
    - $D$10:$D$11 are the sum of what you want raised to the power
    - $D$9 is the constant adder
    - put the percent growth in some cell, as suggested - call it $E$1

    Then I'd set up the following - I'll use col A and B, starting in row 1, but you can use whatever you want;
    YEAR AMOUNT
    1 =(SUM($D$10:$D$11)*((1+$E$1)^A2)) + SUM($D$9)
    2 = [just drag the formula from B2]
    Note the only thing that changes in the above formula as you drag it is A2 changes to A3 to A4 to ... Since A2 references the year, the year then becomes the "power" in the formula, which means you are multiplying the % up to the power given by the year.

    Hope this helps (and hope I didn't screw up on the parens).

    Fred

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    Re: Grow Only Part

    Fred,

    The formula works like a charm!!

    Thanks.
    <font face="Comic Sans MS"><big><font color=4682b4>Sherry</font color=4682b4></big></font face=comic>

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    Re: Grow Only Part

    Thanks. And range names do help!
    <font face="Comic Sans MS"><big><font color=4682b4>Sherry</font color=4682b4></big></font face=comic>

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    Re: Grow Only Part

    I see now. Thanks for your help.
    <font face="Comic Sans MS"><big><font color=4682b4>Sherry</font color=4682b4></big></font face=comic>

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