# Future Value Calculator

Invest Now

### What is Future Value?

Future value is the anticipated worth of your money or investment at a future date, revealing how much it could grow over time. It's a key concept for investors and planners, helping gauge the future value of present savings. Understanding future value is vital for beating inflation and making informed decisions about financial goals. In business, it's crucial for calculating returns on investments, aiding strategic decision-making.

### What is the Future Value Calculator?

The Future Value Calculator is a financial tool designed to estimate the future worth of an investment based on variables such as the initial principal amount, interest rate, and time. This calculator facilitates the prediction of how an investment or savings account will grow over a specified period, accounting for factors like compound interest or regular contributions. Users input relevant data, and the calculator generates a projection of the investment's future value.

It serves as a valuable instrument for financial planning, allowing individuals to make informed decisions about savings, investments, and long-term financial goals by predicting the potential growth of their assets.

### How does Future Value Calculators work?

The future value calculator helps you estimate how much your savings will grow over time. It considers your regular deposits, the interest rate, and the number of years you plan to save.

The formula used is A = PMT ((1+r/n)^nt – 1) / (r/n)

Where,

• A is the Future Value of the Investment,
• PMT is the payment amount for each period,
• n is the number of compounds per period, and
• t is the number of periods the money is invested

For Example, imagine depositing Rs 10,000 each month with an 8% interest rate compounded monthly for 10 years. If the deposits are made at the end of each month, the future value (A) would be around Rs 18,29,460. If the deposits are made at the beginning of each month, it adjusts slightly to approximately Rs 18,17,345.

### Benefits of Using a Future Value Calculator:

Following are some of the advantages of using future value calculator:

• Financial Planning: The calculator aids in long-term financial planning by providing insights into the potential growth of investments over time.
• Goal Setting: Useful for setting and achieving financial goals by understanding how regular contributions impact future wealth.
• Efficiency: Streamlines complex calculations, saving time and ensuring accurate projections without manual computations.
• Tax Planning: Helps in tax planning by projecting the future value of investments, allowing users to make strategic decisions considering tax implications.

### FAQs

What exactly is Future Value (FV)?
How is Future Value calculated?
Why is Future Value important in finance?
How does Future Value differ from Present Value?