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