Compound Interest Rate Formula
Jan 27, 2007
I am trying to calculate the effective annual interest rate earned on an investment and find the results are close but not really accurate. I suspect because I have not included the frequency of interest in my existing formula
r = n * nt root (A/P-1)
where;
r = the effective interest rate
n = the number of times interest is added per year
t = the total number of years
A = the current value
P = the original value
The 2 problems I face are;
1. Confirming this formula would provide the correct answer (need maths expert here) &
2. How would "nt root" (as in sqr root, but using the product of the years and frequency) be used in Excel
View 9 Replies
ADVERTISEMENT
Dec 20, 2011
I would like to have an excel table that has 240 usable lines going horizontal (to the right) and vertical (down) from the starting number.
I need it to compound interest in both directions
240 is the total number of days per year I am trying to track
There should be adjustable starting amounts and compound interest
Be able to adjust the entered amount anywhere along the time line and it recalculate the amount from there on...
View 2 Replies
View Related
Jun 4, 2007
The formula I am looking for would tell me what annual growth rate % I would need to achieve to make any investment reach a set target, for instance, what % of fixed annual growth would I need to make 200K grow to 750k in say 10 yrs or any time scale. I was given the formula below but Excel tells me it's wrong, I have tried putting 10 before ^ and the 10 after but to no avail, could some kind soul please put me straight.
r = 100((Y/X)^(1/n))-1)
So for X = 200, Y = 750, n = 10, we have
r = 100((750/200)^(0.1))-1) = 14.1309%
View 3 Replies
View Related
Aug 6, 2006
I have a column of years and a column of numbers representing annual
amounts placed in a savings account for the year. I would like to calculate
the balance of interest earned added to the balance of the account and then
calculate the interest earned on the accumulating amounts each year. The
results would be the account balance displayed in an adjoining column. So
far, I have not found a worksheet function for that. Could someone point me
in the right direction? Perhaps there should be several columns of data?
View 10 Replies
View Related
Jun 30, 2007
I am trying to create a calculator based on a worksheet I have. I do not know how to write a formula for simple interest calculations and for compound interest calculations.
View 4 Replies
View Related
May 16, 2014
Formula to calculate a daily compound interest based on the higher rate of the two rates for the first 5 years, then after 5 years the calculation would only be based solely on the blocked rate.
View 4 Replies
View Related
Sep 22, 2011
I am trying to work out a formula to calculate compounded interest rates.
I have a table that is 24 columns wide (months).
1 row that will have amounts input in to the columns (these will be different amounts)
I want to have a row along the bottom that calulates the compounded interest at a fixed interest rate on the total amount that is in the first row.
I have managed to do this using a table but surely there is a formula for this as the table can become very troublesome if the input amounts change.
Ive added an image (attached) : excel.jpg‎
View 6 Replies
View Related
Apr 10, 2008
I am trying to set up my excel to calculate daily compound interest.
The amount is 10,000 at 0.75% per day for 6 months.
I have tried several different things with no success -
View 9 Replies
View Related
Aug 3, 2014
I am looking for a formula which will compute interest earned (not ending account balance) for the following scenario:
1) Set $ amount (say 19250) is deposited on January 1.
2) Annual interest rate is .95%
3) Interest is compounded daily
4) Fixed withdrawals of $1750 are taken each and every month on the first day of each month
What is the total interest earned on the account? Basically, it is a issue where each month diminishes the "pool" of money earning interest. I get what's going on conceptually, but can't figure out which Excel function to use.
View 4 Replies
View Related
Mar 5, 2013
I am looking to calculate compound interest over a period of 10 years.
I am looking at putting a lump sum in at the beginning and contribute in monthly installments for the entire 10 years. How would I go about this.. I know there are formulas there, however I'm not a financial person at all..
View 9 Replies
View Related
Dec 6, 2008
I'm trying to come up with a way of calculating Money earned over time by compounding interest, but with a twist. After reaching a set amount of money, all money above and beyond does not gain interest. example:
Principal: $120 (user input value)
Duration: 9 (user input value in days, compounding daily)
%Intertest: 4% (user selected value, either 2% or 4%)
Max interest you can earn: $6 (fixed)
Max interest generating money: $150 (variable dependant on %interest, = $150 or $300)
Response/Answer is final value. I don't need the daily results like the example.
Result would be: $170.84
$124.80 (4.80 interest)
$129.79 (4.99)
$134.98 (5.19)
$140.38 (5.40)
$146.00 (5.62)
$151.84 (5.84)
$157.84 (6.00 reached the max interest level)
$163.84 (6.00)
$170.84 (6.00)
my equations I have so far only do one (below 150 total) or the other (above) but not both. and its just a regular formula: =IF(P<M,IF(P*I^D<M+1,P*I^D,"over limit"),P+6*D)........................
View 2 Replies
View Related
May 10, 2008
I've found this calc but it doesn't compare to my particular scenario/goals: http://dinkytown.net/java/InvestmentDebt.html. The major difference is that this dinkytown calc requires a new loan to be put in place and I am not in a position to refinance my current mortgage. My plan is to pay an extra $267 (b3) to the mtg (b4). It will take 128 months (b6) to pay off the mortgage. After that point, I need to calculate what the newly freed capital (b5) would do if I put in an account (i.e. a CD or a simple US savings account) that had an Annual Percentage Yield (APY) of 1, 2, and 3% for 20, 15, 10 and 5 years. I thought that I had the right formula in place for cells b7:b8 should the account earn a 0% rate of return, but I think it's faulty since it gives me a negative number for 10 and 5 year accumulation periods.
View 2 Replies
View Related
May 19, 2006
I have a column of 30 cells, each showing retirement dollars earned based on years of service (cell 1 = year 1, etc) and salary. Here is the predicament: A new hire is brought in with 10 years service, stays 5 and then quits. How do I change only cells 10-14 reflecting his/her salary and retirement dollars? Remember, cell 10 is the first year for the compound interest, cell 11 the second year, etc. I currently use the following formula for cell 10 (compounded salary from cell 9 * (1+.05)^1). Cell 11 is (compounded salary from cell 10 * (1.05)^1.
View 5 Replies
View Related
Mar 16, 2009
Im trying to work out the formulae or fuction that will work out the monthly compound rate of a loan.
The loan details are £140,000 at 7.55% APR for 20 years.
View 2 Replies
View Related
Mar 6, 2007
Is there a function that calculates what interest rate is needed to turn a $2000 investment into $9000000 in 30 years based on compounding interest?
View 9 Replies
View Related
Nov 8, 2008
Some years ago I came across a formulae to calculate Daily Interest on a Building Society Savings account in the UK. I have used this since but find my calculations never work out the same as my BS, although to my advantage! It is =B3*B4/360*DAYS360(B5,B6,TRUE) Where:
B3=Capital
B4=Interest Rate
B5=Starting Date
B6=Finishing Date
For some reason the formulae uses 360/year and not 365/year. Using both still gives wrong answer.
View 2 Replies
View Related
Sep 15, 2013
find attached herewith a sample file.
View 4 Replies
View Related
Aug 18, 2009
If I invested $350 per hectare into a project and at the end of 12 years that investment yielded me $150,000, what would my rate of return be over the life of the project?
View 9 Replies
View Related
Jan 31, 2014
I currently use goal seek to calculate an interest rate for a loan product. My problem is i would like to have the same function but not through a goal seek. In goal seek i have to set the value i want to achieve but ideally i want it to calculate automatically
I have attached a workbook with details. I use a loan amortization schedule to calculate the interest from parameters set on sheet 1
View 2 Replies
View Related
Feb 2, 2014
I would like a function which works like the NPV function except that the interest rate should be variable and a range rather than a single number.
Is it possible to see the code for the excel NPV function so that I can modify it?
Or alternatively has seen such a function?
View 8 Replies
View Related
Jul 6, 2013
I keep coming across bonds having different annual interest rates and different compounding frequencies (quarterly, half yearly and yearly).
I know there is a YIELD function, but it requires so many inputs. I was wondering whether we can calculate cumulative yields just from annual interest rates, compounding frequency and investment duration?
View 1 Replies
View Related
Mar 4, 2014
I have a capital lease amortization schedule with annual increases to monthly rent that I am trying to solve for an interest rate such that the balance nets to zero at the end of the term. I am calculating on a monthly basis; in other words, principal minus monthly payment plus monthly interest expense equals ending monthly balance is calculated in each row each month. The present value is known, payment term is known, future value is zero, and the payment amounts increase annually. These assumptions may change for new leases so ideally the solution would be dynamic, adjusting for shorter/longer terms, etc. Here is an example of my assumptions:
Payment start date: 8/1/13
Term end date: 10/31/2025
Rent length in months: 144
1st months rent: $500,000 - payments are due at the beginning of the month and are paid monthly
Annual rent escalation: 3% - i.e. 1st 12 months is $500k/month, 2nd 12 months at $515K, etc.
Beginning NPV: $75M
Ending value: $0
Imputed annual interest rate: UNKNOWN
I'm not sure if this is relevant, but the monthly payment is allocated between principal and interest. Monthly interest expense is calculated as the current balance * (imputed interest rate / 12).
Currently, I've plugged the interest rate such that my ending balance is 0, however I was hoping to calculate it on the fly as opposed to manually plugging it.
how to calculate annual interest rate with these inputs? Is there a way to make the rate function work with payment increases?
View 7 Replies
View Related
Aug 27, 2008
I have a calculation I do that calculates a clients "effective interest rate" if they make extra payments towards principal.. Calculation works fine.. However, I am now trying to figure out how to amend that code if it's an interest only loan, anyone have any ideas?
Here is the effective rate calcs on a random normal amortization loan:
this is in B2, and answer is 7%
=RATE(B4*B5,-((B3+B7)/B6),B7)*12
B3 = Total*Interest 279017.8
B4 = #*Years*in*Loan 30
B5 = #*Payments*/*Year 12
B6 = Total*Payments 360
B7 = Beginning*Principal 200000
B8 - Ending*Balance 0
problem is when someone is on an interest only loan they pay more interest than a normal amortization because they are not reducing the principal in the first x number of years. So I need to compare the interest only effective rate to an interest only loan.
Here is the example I'm working on... A client's loan is the following:
Loan amount - 131,538
interest rate - 6.15
30 year amortization
10 years interest only
normal client would pay an interest only payment of 674.13, then after i/o period would go to 953.80 for last 20 years of the loan, and they'd pay about $178k in interest.. Now if that client pays an extra 1,000 per year, I can calculate the amount of interest they'd accrue, but have no clue how to back into the "effective interest rate", basically that says you are paying the same amount of interest as someone with a x.xx% interest only loan.
View 9 Replies
View Related
Apr 9, 2014
I have a created a Data Chart Below. A - C are the columns and 1-7 are the rows. I have hard-coded the equation in cell B5 that I am using.
What I want to do is input an number into B3 that automatically makes Cell B5 equal to Cell C1. Is there a process in excel you can use to do this. Or do you just have to use trial and error?
A B C
1Loan Amount$10,500,000 0.0730041581143804
2Term 10 years
3Rate
4Amortization30 years
5Constant (K) =PMT(B3/12,(B4*12),-1000)*0.012
6Annual Payment$766,544
7Monthly Payment$63,879
Example is attached.
View 1 Replies
View Related
May 25, 2009
The way I have this sheet setup is to calculate a 20% fee off the interest earned column "D". Say you earned 6.5% on a beginning balance so the interest earned is in col "D". This works fine for a 20% fee but I need the fee to calculate a 10% fee if the interest in column "C" hit 4% or below and it also needs to be able to calculate a 20% fee if the interested earned is above 4%.
View 5 Replies
View Related
Dec 29, 2013
I have a problem calculating a total interest for an input period that has different interest rates. You can see the attached file: INTEREST.xls
I have used a function but the result comes out wrong. Can I fine tune it or do I have to change my method of calculating.
View 10 Replies
View Related
Nov 18, 2008
I have a person who was paid £1000 pension pa for ten years. I've found out that the pension should have been split 50/50 with half increasing by 5% pa. Thus in year 1 total pension would be £1000. In year 2 the total pension would be £1025 ((£500 x 1.05) plus £500)
I know that in year 10 the total pension should be £500 (non increasing) plus £814 (£500 x 1.05 to the power of ten). My problem is how do I work out a formula which calculates the total arrears due in year ten? I'm thinking the arrears due after the ten years is £314 but something is telling me it's a lot more.
View 3 Replies
View Related
Dec 10, 2007
I am trying to set up a budget for my self. Of course I am trying to make it as complicated as possible.
I have done searches online and that is how I found this forum. I am finding amortization formulas, but not what I want
Here is my question.
I have two fields, Mortgage and auto loan
I want to have a field that does a calculation for me.
I know following fields as an example making numbers up
Interest rate is fixed at 5.5%
Amount left on loan is 150,000
Loan is fixed at 30 years with 28 years left
I want to run a formula so when I make a monthly payment of 1000 dollars how much of that goes to interest, how much to principle (not to make this complicated even more, but let say that I have 200 escrowed which I am not sure if that has interest calculated on(I don’t think so as it is property tax?))
Same example for car loan.
5 year loan, 4.5% interest, payment 438 a month.
View 9 Replies
View Related
Aug 24, 2006
I have been raken by brain for a simple formula to calculate an Interest Only Payment on a mortage note, example,
sales price = $162000
term = 360
interest = 8.5
I was able to calculate the payment of principle and interest, but I need to validate what would be an Interest Only payment on this?
View 5 Replies
View Related
Feb 20, 2014
If i borrow Rs.50000/- at 7.25% interest compounding monthly, repayable in 4 quarterly instalments, when i put it in excel using pmt function for emi quarterly payment and ipmt for interest calculation at the end of the 4th quarter (i.e last instalment) the balance will not become zero it shows a balance of Rs.14.35 its due to interest compounding monthly, is there any formula in excel to overcome it?
View 2 Replies
View Related
