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Future Value Calculator
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Date publish: 18.09.2024
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Author: Calcwizard
Understanding Future Value
The future value (FV) of an investment is the amount of money that an investment will grow to over a period of time at a given interest rate. This concept is crucial for investors who want to understand how their money can grow over time.
Interesting Facts
- The concept of future value is based on the principle of time value of money, which states that a dollar today is worth more than a dollar in the future due to its potential earning capacity.
- Future value calculations can help individuals plan for retirement, education expenses, and other long-term financial goals.
- Compounding interest can significantly increase the future value of an investment, especially over long periods.
How to Use the Future Value Calculator
To use the Future Value Calculator, you need to input the following:
- Present Value (PV): The current amount of money you have.
- Annual Interest Rate (r): The percentage rate at which your money will grow.
- Number of Years (t): The time period for which the money is invested.
Examples of Future Value Calculations
| Present Value (PV) | Annual Interest Rate (r) | Years (t) | Future Value (FV) |
|---|---|---|---|
| $1,000 | 5% | 10 | $1,628.89 |
| $2,000 | 3% | 5 | $2,318.55 |
| $500 | 7% | 15 | $1,759.11 |
| $10,000 | 4% | 20 | $21,908.49 |
By inputting different values into the calculator, you can see how varying the present value, interest rate, or time period affects the future value of your investment.
