Future Value Calculator: Calculate the future value of your current amount

The future value calculator is a simple online tool that calculates the future value of your current principal and the additional yearly investments you make. The calculator shows the worth of your investment in the future. In the future value calculator tool, you have to only enter your current investment amount, rate of interest, yearly additional investment, rate of interest, and the total number of years. The calculator generates the result within a fraction of a second.

What is Future Value?

Future value is the worth of your cash or an asset that is in the future. It shows you how much you need to save or invest so that you achieve your financial goal in the future. It is an important aspect for an investor as it helps in making sound financial decisions for the present and future.

Understanding future value helps you in achieving a rate of return above the inflation rate because you tend to know the future value of your investment and project, so you tend to invest only in those assets which are likely to earn returns above the inflation rate.

Sample Illustration of Future Value calculations

 

How does Future Value Calculator work?

The formula used for the calculation of the future value of your investment is as under:

A = PMT ((1+r/n)^nt – 1) / (r/n))

Where,

A = Future value of your investment

PMT = payment amount for each period

n = number of times the amount is compounded per period

t = number of periods your amount is invested

This formula assumes that the regular deposits are made at the end of each period such as year or month.

 

Example:

If you deposit Rs. 10000 per month at an 8% interest rate compounded monthly, it means 12 compounds per period. The value of your investment after 10 years is as under

PMT = Rs. 10000

n = 12 (number of compounds per period, it is 12 for monthly compounding)

t = 10 years

              A = (10,000((1+0.08/12)¹²⁰ – 1) / (0.08/12))

              A = Rs.1829460

           

How can Future Value Calculator help you?

1. The future value calculator helps you calculate the future value of your investment and aids in financial planning.
2. It’s easy to use, simple and accurate. It generates results within a fraction of a second.
3. In business future value calculator helps in making the right financial decisions as you already know well in advance the future value of earnings.