Microsoft Office Tutorials and References
In Depth Information
Using FV to Estimate the Future Value of a Regular Savings Plan
type This is either 0 or 1 to indicate when payments are due. The de-
fault value of 0 assumes that payments are due at the end of the
period. A value of 1 means the payments are due at the beginning of
each period.
In Figure 13.5 , the NPER function in cell B5 estimates how many months you
can withdraw the amount in cell B2. Note that the monthly withdrawal is neg-
ative from the point of view of the retirement account.
type
Figure 13.5.
Figure 13.5. Use
Use NPER
NPER to figure out how long an annuity can pay out before it
to figure out how long an annuity can pay out before it
ends in a zero balance.
ends in a zero balance.
Using
Using FFV to Estimate the Future Value of a Regular Savings Plan
to Estimate the Future Value of a Regular Savings Plan
The future value calculation assumes that you will make regular monthly
payments to a savings plan every month. It also assumes that the interest
rate does not change throughout the life of the savings plan. If you are
young, it is likely that you can save more as your income grows later.
However, using the savings calculator in Figure 13.6 helps you to realize
the value of regular savings.
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