subject: Compound Interest Formula With Deposits: Small Deposits To Large Profits [print this page] Banks offer savings account wherein you do frequent and fixed deposits to save more with a good rate of interest for a future date. Up until today, it is still debated on what is a better, making deposits in savings account or investing on stocks. Most advisers would not recommend investing on stocks due to cost averaging purposes. It is safer to invest in something that is a sure win when it comes to profits. Using the compound interest formula with deposits, you will see, why it is good to invest in savings account. All you have to do is make frequent deposits and do a goal-based investment. There is where you can get a sure win.
What Is The Process Of This Investment Using The Compound Interest Formula With Deposits?
Investing on stocks requires you to make a big one-time deposit of cash. Then, you will need all the luck in the world to have profits in return. However, if you cannot afford such thing and want something more secure, then, the frequent deposits are what you can do. It is done usually in banks or any monetary institutions that offer such a deal.
With frequent deposits, the money that you invest will gain more money every compounding period. The usual compounding period of such investments is every month. So, basically all you have to do is make deposits and wait. Then, in return, you shall get your deposited amount together with the interest gained from it.
This is where the compound interest formula with deposits becomes really helpful. Before making a decision on the frequent deposits you will make, you can check out first what will be an estimated outcome of it using the compound interest formula with deposits. You can also check with the compound interest formula with deposits the effect of each element in the compound interest formula. It is true that with compound interest, interest gains on interest and the principal, as well. It sounds good, right? But of course, you want to know the exact or the nearest amount that you will profit from an investment. Using the compound interest formula with deposits, you can be surer and more secure with the investment that you shall make.
If computations scare you then fret not. We now have compound interest formula with deposits in calculators.
We now have calculators that have easy user interface that you can use in computations with the compound interest formula with deposits. The compound interest formula with deposits use in a calculator can give you the total amount that you can gain from an investment. It calculates based on the details that you entered in compound interest formula with deposits calculator. The compound interest formula with deposits in calculators is also capable of giving you the total interest earned of the investment. Cool, right? Just be sure to fill in all the asked details.
The details needed in the compound interest formula with deposits in calculators are:
Frequent deposited amount
The rate of interest (depending on the compounding period asked by the calculator e.g. monthly rates, yearly rates, weekly or daily rates)
The time of the whole investment (usually in years or months)
How frequent you shall make the deposits (usually asked if monthly, weekly, or daily)
Using the said details, the compound interest formula with deposits that the calculator uses will be able to give the results even before investing!
