From the course: Google Sheets: Advanced Formulas and Functions

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Calculate the future value of an investment

Calculate the future value of an investment - Google Sheets Tutorial

From the course: Google Sheets: Advanced Formulas and Functions

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Calculate the future value of an investment

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- [Narrator] One of the more conservative investment strategies available is to purchase an instrument such as a certificate of deposit or a fixed rate annuity that enables investors to trade lower risk for a relatively low but known rate of return. You can evaluate this time of investment using the future value or FV function. To calculate future value, you need to know a number of different things. The first is the annual rate. For example, your investment micro at 6% per year. Next you need to know the number of periods. In this case I have that as five. The implication is that the investment will grow over five years and will be compounded annually. If I had a number of periods of 60, then that would be monthly compounding over five years for 60 total months. Next is the payment and a present value. You have to have one of these two arguments filled in and you may also have both. In this case the payment is the amount of additional capital that you pay into the investment every…

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