subject: Compound Interest Table Creation Using Ms Excel [print this page] If you are into investing the easiest way to do this is through savings account where money would add up by itself through interest. If you want to know how much profit youll get after a year with a savings account and with a certain amount of money and interest rate then you would need to make a compound interest table which uses a compound interest formula. Computing for the compounded amount is a bit complicated if done manually. A good example would be $100 with a 2% rate of interest. After a year, it will now be a hundred and two dollars. This is a computation that you can do hassle-free with a compound interest table.
Here is another good example where the compound interest table would be good to have.
Let us continue with the given example above. After the first year, what about the next? This is if you decided to still save and continue the accruing of interest paid on your savings account. After compounding of another 2% to your hundred and two dollars then you will now gain a hundred and two dollars and forty cents. With the compound interest table already done for you, theres actually no need for computations at all. You will have an automatic answer to the profits youll gain on your savings account. So how does one make a compound interest table? Since we are all high tech now, we can use a program called Microsoft Excel to make one.
Making a compound interest table using MS Excel is easy as long as you know the right formula for the answer that you are solving for. Certain rows or columns or fields should have the right formulas in them. Be sure that you have the correct input for your interest rate. If the bank gave you an annual rate then to know the monthly rate, you should divide it by twelve. With the compound interest table, your profits will get a bit higher than the actual one since there will be no fees and charges that goes with the computations. So mainly, the purpose of the compound interest table is to give you a hint on how big a profit could get from a certain savings account with an interest rate and a principal amount in a given time period.
How To Make A Simple Compound Interest Table For Your Savings Account
The first thing you have to do is open the program MS Excel. Get your columns labeled as Date, Profits, Additional Deposits, and Interest. Be sure to get direct contact with your bank to know details regarding your savings account to get the most approximate answer. In the compound interest table Date column, input your monthly dates or yearly dates depending on when the interest gets compounded. Then on the Profits column, input the total amount you have in the bank at the moment. For the Additional Deposits column, if you regularly make additional deposits then put in the certain amount. If not, then just add it up to your Profits column. In the Interest column in the compound interest table, put in a certain formula.
Formula for interest column in the compound interest table yearly compounding:
=[cell no. of profits] + [cell no. of additional deposits] + interest rate*.01 * ([cell no. of profits] + [cell no. of additional deposits])
