Exceltemplates.org – Investing your money is such a risky thing to do. And certainly you would prefer a place which can give you a high rate of interest in order to get back your profit. That is why many investors would prefer to invest their money to a place that could give them with a compound interest, which is also often called as interest within interest. Unfortunately, determining the exact rate from compound interest is quite difficult. And that is why Compound Interest Calculator was invented. Compound interest calculator is highly useful to determine the increase of your savings affected by the compound interest and also the overall compounded interest.
Compound interest apparently has been existed since the early human civilization. It could be proved as compound interest was mentioned both in the Bible and the Quran which stated that compound interest is a sin. Back in the roman era, compound interest was also deemed as the worst type of usury and was considered as illegal matter. It wasn’t until the 17th century where people started to accept the use of compound interest. And since then, people have been developing ways to calculate their compound interest and they called them the compound interest calculator. Nowadays, it is common for people to compare their investment and their bank saving using this calculator. With less risk, usually people will save their money in the bank and accept low interest based on compound interest calculation.
How to Calculate your Compound Interest
There is a fixed formula in which you can calculate the overall result of the compound interest. Through the template of excel, you only need to fill the column and you are set to calculate. Fill out your original investment (p) in the investment column. The annual interest rate (k) is placed in the interest rate per year column. Number of compounded period (m) is in the compounded column, while the number of period (n) is in the period column. And in order to find the overall result you only need to calculate through the fixed formula which is P*(1+(k/m))^(m*n).
This spreadsheet has three different tables. You can make comparison between different banks and terms to find the most profitable one. You can copy and paste current table if you need more calculation. Also, you can learn how to create one since you can see the Excel Finance function used in this calculator. You might need it if you want to insert it into your own finance spreadsheet.
Using Microsoft Excel to simplify your spreadsheet tasks is not as difficult as you think. I learned how to use it in less than 24 hours and rely on internet to find the solution if I got stuck. I am not an Excel expert, but here are all useful spreadsheets I have collected and created.