"JayM" wrote:
That's close but not cigar.

As I said, if that is not exactly what you expect, post a 12-quarter annuity
schedule to demonstrate how you think the computation should be done.


That method changes the deposits to being a single deposit

"Deposits"? Do you mean withdrawals? You said this is an annuity.


the interest calculation performed on a single deposit at the
beginning with the compounding on the full amount at the end
of the quarter. Not an accurate calculation.

Sure it is, if interest is indeed compounded quarterly, as you said
originally.

Do you mean, perhaps, that interest is __paid__ quarterly, but compounds on
a different schedule, perhaps daily, perhaps monthly?

The FV function (and PV function) can be made to work whenever the payment
is regular and invariant and the interest is regular and invariant, even when
payment and interest are on different schedules.

But exactly how to make that work depends on the details. When you are
clear on the details, we can be clear on the solution.

(However, note that terms like "end of month" and "end of quarter" may not
be really "regular" if interest compounds daily because the number of days
varies per interval.)


----- original message -----

"JayM" wrote:
That's close but not cigar.
By using that method your compounding calculation is not accurate. That
method changes the deposits to being a single deposit at the beginning of the
period (quarter) rather than 3 monthly deposits; and the interest calculation
performed on a single deposit at the beginning with the compounding on the
full amount at the end of the quarter. Not an accurate calculation.

"Joe User" wrote:

"JayM" wrote:
I see the "Future Annuity Calculator" template but
what I'm trying to do is calculate the FV of annuity
based on monthly payments with quarterly compounding.
FV calculation will not allow the mix.

Yes it does. You just need to know how to do it properly. Consider the
following example.

$100,000 in A1 (initial investment). $333 in A2 (monthly annuity). 5% in
A3 (annual return, compounded quarterly). 3 in A4 (term of annuity in
years). The future value is:

=FV(A3/4, A4*4, A2*3, -A1, t)

where t is 0 or 1 depend on how you model the investment return.
Specifically, t=0 if the quarterly return is based on the beginning balance
before payments (e.g., 1st-quarter ending balance is A1*(1+A3/4) - 3*A2); or
t=1 if the quarterly return is based on the ending balance after payments
(e.g. 1st-quarter ending balance is (A1 - 3*A2)*(1+A3/4)). I would opt for
t=1.

Of course, most annuities have longer terms. I chose a term of only 3 so
that it is easy to verify that the FV formula is giving you what you expect
based on a 12-quarter annuity schedule that you can construct manually.

If not, post a follow-up in this thread with the details of your 12-quarter
annuity schedule. That will provide useful insight into exactly what you
expect.