Sponsored Links:

## What is meant by future value?

The value of the asset at a particular date is known as the future value. Generally this future value or FV means that it measures nominal future sum of the money which is given sum of the money & it turns out to be worth at that specified time in the future. Moreover, it even has the interest rate or you can call it as the rate of return. This is in – turn the present value which is multiplied by none other than the accumulation function. Corrections for the inflation as well as the rest of the factors which affect true value of money in future are not a part of this future value.

## Future Value Calculator

### Future value formula

The mathematical equation which is made use of in the future value calculator is as follows –

\(FV=PV+PVi\quad or \quad it \quad is \quad also \quad written \quad as \quad \)

\(FV=PV(1+(interest \quad rate \quad \times \quad number \quad of \quad years ))\)

\(FV \quad or \quad the \quad future \quad value \quad = $1,000 \quad \times \quad (1+(0.1\times5))\)

\(FV \quad = $1,000 \quad \times \quad (1+0.5)\)

\(FV \quad = $1,000 \quad \times \quad 1.5\)

\(FV \quad = $1,500 \)

Sponsored Links:

## FV with compounded interest

When the future value is calculated with the compounded interest then the following formula is taken in to consideration –

\(FV \quad or \quad the \quad future \quad value \quad =\quad present \quad value \times [ (1+interest \quad rate)^{number \quad of \quad years }]\)

\(FV \quad = \quad $1,000 \quad \times \quad [ (1+0.1)^{5}]\)

\(FV \quad = \quad $1,000 \quad \times \quad (1.1)^{5}\)

\(FV \quad = \quad $1,000 \quad + \quad 1.61051 \)

\(FV \quad = \quad $ \quad1,610.51 \)

### Points to remember

An individual has to keep the point in mind that the simple interest generally depends on present value while on the other hand, compounded interest states that present value or PV is on the rise annually.

## Terms related to future value calculator

Period is the time interval for as long as the inputs turn to be constant. While PV is the present value or it is also known as the principal value. Number of periods or years is the time whereas the interest rate or the rate of interest is the interest rate per percent in a period.

## How to use an FV or the future value calculator?

To make use of the future value or the FV calculator, one has to initially enter the number of periods (N) which is followed by the start amount. In the next field, you should mention the interest rate or the rate of interest. In addition to this, user will be required to mention PMT or the periodic deposit. When all the fields are filled, you can click on the calculate tab to get to know the result.