Leading the way in Microsoft Office Development

Understanding Monthly Deposits

Any savings account consist of five important numbers. These are the following:

1) The final lump sum you will receive at the end (often called the future value).

2) The total amount you want to invest every month.

3) The interest rate which you will receive on your deposits.

4) The number of years the money will be in the bank for.

5) The number of years it will take for you to have saved a certain amount.

Lets assume you want to save £150 a month for 3 years in an account that offers 5.8% interest a year.

FV - How much would I have saved at the end ?

 -

FV(rate, nper, pmt [,pv] [,type])

You can calculate ??????????? by using the FV() function.

PMT - How much do I need to save a month ?

 -

PMT(rate, nper, pv [,fv] [,type])

You can calculate ???? by using the PMT() function.

RATE - What interest rate am I getting ?

 -

RATE(nper, pmt, pv [,fv] [,type] [,guess])

You can calculate ?????????? by using the RATE() function.

NPER - How many months have I been saving for ?

 -

NPER(rate, pmt, pv [,fv] [,type])

You can calculate ?????????? by using the NPER() function.

NPER - How many years until I have £20,000

 -

NPER(rate, pmt, pv [,fv] [,type])

You can calculate ?????????? by using the NPER() function.