The compound interest formula solves for the future value of the investment after set number of years. It is the result of reinvesting interest rather than paying it out so that interest in the next period is then earned on the principal sum plus previously accumulated interest. In the example the monthly payment is obtained by entering either of these formulas.
F V P 1 i c n c displaystyle FVP1frac icnc The variables within the equation are defined as follows.
We created the above Calculator using JavaScript language. This formula is provided using the financial function PMT in a spreadsheet such as Excel. The formula for computing Compound Interests is. The formula for Compound Interest Calculator with Additional Deposits is a combination of.