FV function
I have to make a plan for a monthly payment deposit for the next 15 years.
The account pays 4.5% annual interest, compounded monthly. I have to use the FV function to determine the % of college tuition saved. Out of State Annual Tuition=40000 Rate(per month)=4.5%/12 Nper(number of monthly payments)=15*12 Pmt(payment per period)=375 Percentage of Tuition Saved=FV/Tuition for 4 years For the Future Value, I used =-FV(0%/12,180,375), which gave me a return of 69,423.38. Am I going in the right direction? |
FV function
"Struggling College Student"
m wrote: I have to make a plan for a monthly payment deposit for the next 15 years. The account pays 4.5% annual interest, compounded monthly. I have to use the FV function to determine the % of college tuition saved. I think you want (in A1): =fv(4.5%/12, 15*12, -375) which translates into depositing 375 per month into a savings account that earns annual interest of 4.5% compounded monthly. Right? If I misunderstood the financial arrangement, please clarify. As for percent of tuition saved: =A1 / (40000 * 4) formatted as Percentage. PS: When using Excel financial functions like FV, PV and PMT, inflows and outflows should have different signs (positive and negative). Which to use for inflow or outflow is arbitrary; it depends on your point of view (saver v. bank; borrower v. lender). I tend to choose the point of view that results in a positive function result. "Struggling College Student" m wrote in message ... I have to make a plan for a monthly payment deposit for the next 15 years. The account pays 4.5% annual interest, compounded monthly. I have to use the FV function to determine the % of college tuition saved. Out of State Annual Tuition=40000 Rate(per month)=4.5%/12 Nper(number of monthly payments)=15*12 Pmt(payment per period)=375 Percentage of Tuition Saved=FV/Tuition for 4 years For the Future Value, I used =-FV(0%/12,180,375), which gave me a return of 69,423.38. Am I going in the right direction? |
FV function
See responses to your thread "Saving for College". I think the title of
that thread and your posting there make you question clearer. For future reference, keep all related postings in the same (original) thread. ----- original message ----- "Struggling College Student" m wrote in message ... I have to make a plan for a monthly payment deposit for the next 15 years. The account pays 4.5% annual interest, compounded monthly. I have to use the FV function to determine the % of college tuition saved. Out of State Annual Tuition=40000 Rate(per month)=4.5%/12 Nper(number of monthly payments)=15*12 Pmt(payment per period)=375 Percentage of Tuition Saved=FV/Tuition for 4 years For the Future Value, I used =-FV(0%/12,180,375), which gave me a return of 69,423.38. Am I going in the right direction? |
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