In previous post, we learnt about Calculate monthly installment of a loan in Excel. In this post, we shall learn 'What if I had invested scenario' in Excel. We will learn what If I would have invested a certain amount for certain period assuming to get certain interest rate then how much amount we would end up getting.
Before we go ahead with this calculations, we need to understand the behavior of Excel.
Excel treat all payment as negative amount and all receipt as positive amount. So when we are paying monthly installment, its negative amount in the formula.
To get the maturity amount again, we shall use FV function of Excel. Look at below scenario, where we are assuming that I would
Let's say that we want to buy an annuity plan that will pay us 1000 every month for next 10 years at the rate of 8.75%, how much we need to invest?
To calculate the annuity amount, enter '=PV(B6/12,B5*12,B4)' formula in B12, here
and the result is 79,791.42.
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