Excel FV Function

last modified April 4, 2025

The FV function calculates the future value of an investment based on periodic, constant payments and a constant interest rate. This tutorial provides a comprehensive guide to using the FV function with detailed examples. You’ll learn basic syntax, practical applications, and advanced techniques to master this financial function.

FV Function Basics

The FV function calculates the future value of an investment. It considers regular payments, interest rate, and time period. The syntax includes required and optional arguments for flexibility.

Component
Description


Function Name
FV


Syntax
=FV(rate, nper, pmt, [pv], [type])


Arguments
rate, nper, pmt, [pv], [type]


Return Value
Future value of investment

This table breaks down the essential components of the FV function. It shows the function name, syntax format, arguments, and return value characteristics. All arguments except pv and type are required.

Basic FV Example

This example demonstrates the simplest use of the FV function with regular payments and interest rate.

Basic FV formula

=FV(5%/12, 10*12, -100)

This formula calculates the future value of $100 monthly payments for 10 years at 5% annual interest. The result will be $15,528.23. The negative payment indicates cash outflow.

FV with Lump Sum Investment

This example shows how to calculate future value with an initial lump sum investment plus regular contributions.

A
B


Annual Rate
6%


Years
5


Monthly Payment
-200


Initial Investment
-5000


Future Value
=FV(B1/12, B2*12, B3, B4)

The table shows parameters for calculating future value with both initial investment and regular contributions. The formula divides the annual rate by 12 for monthly compounding.

FV with initial investment

=FV(B1/12, B2*12, B3, B4)

This formula calculates the future value of $5,000 initial investment plus $200 monthly payments for 5 years at 6% annual interest. The result is $19,560.81. Both payment and pv are negative representing cash outflows.

FV with Payments at Beginning of Period

This example demonstrates using the type argument to specify payments at the beginning of each period.

A
B


Quarterly Rate
2%


Periods
20


Payment
-500


Type
1


Future Value
=FV(B1, B2, B3, 0, B4)

The table shows parameters for calculating future value with payments at period start. Type=1 changes payment timing, increasing the future value compared to end-of-period payments.

FV with beginning period payments

=FV(B1, B2, B3, 0, B4)

This formula calculates future value of $500 quarterly payments for 20 periods at 2% per quarter, with payments at period start. The result is $12,148.68. Setting type to 1 yields higher FV than default end-of-period payments.

FV for Retirement Savings

This practical example shows how to project retirement savings using the FV function with realistic parameters.

A
B


Annual Return
7%


Years to Retirement
30


Monthly Contribution
-1000


Current Savings
-50000


Retirement Value
=FV(B1/12, B2*12, B3, B4)

The table demonstrates retirement planning with current savings and regular contributions. The formula converts annual parameters to monthly equivalents for accurate compounding.

Retirement savings calculation

=FV(B1/12, B2*12, B3, B4)

This formula projects $1,000 monthly contributions plus $50,000 initial investment over 30 years at 7% annual return. The future value is $1,522,764.47. Negative values represent cash outflows (investments).

FV for Loan Balance

This example shows how to use FV to calculate remaining loan balance after making payments for a certain period.

A
B


Annual Rate
4.5%


Loan Term (years)
30


Loan Amount
250000


Years Paid
10


Remaining Balance
=FV(B1/12, B4*12, PMT(B1/12,B2*12,B3), -B3)

The table shows loan parameters and calculates remaining balance after 10 years. It uses PMT to calculate the monthly payment first, then FV to find the remaining balance.

Loan balance calculation

=FV(B1/12, B412, PMT(B1/12,B212,B3), -B3)

This formula calculates remaining balance on a $250,000 loan at 4.5% after 10 years of 30-year term. The result is $202,907.93. The PMT function calculates the monthly payment used in FV calculation.

FV with Variable Rates

This advanced example shows how to approximate FV with variable interest rates using multiple FV calculations.

A
B


Initial Investment
-10000


Year 1 Rate
5%


Year 2 Rate
4.5%


Year 3 Rate
6%


Future Value
=FV(B2,1,0,B1)*FV(B3,1,0,1)*FV(B4,1,0,1)

The table demonstrates calculating future value with changing annual rates. Each FV calculation compounds the result for one year at that year’s specific rate.

FV with variable rates

=FV(B2,1,0,B1)*FV(B3,1,0,1)*FV(B4,1,0,1)

This formula calculates future value of $10,000 investment with rates changing annually. The result is $11,623.70. Each FV segment handles one year’s growth, chaining results together.

The FV function is essential for financial planning in Excel. From simple savings to complex loans, FV helps project investment growth. Mastering its arguments and applications will improve your financial analysis. Remember that payment and present value typically use negative numbers to represent cash outflows.

Author

My name is Jan Bodnar, and I am a passionate programmer with extensive programming experience. I have been writing programming articles since 2007. To date, I have authored over 1,400 articles and 8 e-books. I possess more than ten years of experience in teaching programming.

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