Calculation Results
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Understanding PV and FV
Present Value (PV): The current value of a future sum of money or stream of cash flows given a specified rate of return.
Future Value (FV): The value of a current asset at a specified date in the future based on an assumed rate of growth.
Formulas Used
Future Value (FV):
FV = PV × (1 + r)^n + PMT × [( (1 + r)^n – 1 ) / r] × (1 + r)
Where:
PV = Present Value
r = Interest Rate per period
n = Number of periods
PMT = Payment per period
Present Value (PV):
PV = FV / (1 + r)^n – PMT × [( (1 + r)^n – 1 ) / r] × (1 + r)
Where:
FV = Future Value
r = Interest Rate per period
n = Number of periods
PMT = Payment per period
Investment Tips
• Start Early: The sooner you invest, the more time your money has to grow through compounding.
• Regular Contributions: Consistent investments, even small amounts, can significantly enhance your future returns.
• Review Rates: Keep an eye on interest rates and adjust your investments to optimize returns.
