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Future Value Calculator

Calculate the future value of an investment with periodic deposits. See growth schedule with interest breakdown.

Future Value Worksheet
$
%
$
Future value $13,944.24
PV (present value)$11,260.96
Total deposits$1,800.00
Total interest$7,144.24
Starting (81%)
Deposits (13%)
Interest (6%)

Schedule

#Start BalanceDepositInterestEnd Balance
1$5,000.00$150.00$350.00$5,500.00
2$5,500.00$150.00$385.00$6,035.00
3$6,035.00$150.00$422.45$6,607.45
4$6,607.45$150.00$462.52$7,219.97
5$7,219.97$150.00$505.40$7,875.37
6$7,875.37$150.00$551.28$8,576.65
7$8,576.65$150.00$600.37$9,327.02
8$9,327.02$150.00$652.89$10,129.91
9$10,129.91$150.00$709.09$10,989.00
10$10,989.00$150.00$769.23$11,908.23
11$11,908.23$150.00$833.58$12,891.81
12$12,891.81$150.00$902.43$13,944.24

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Future Value Formula

Future value combines the growth of an initial lump sum with periodic deposits:

FV = PV × (1 + r)n + PMT × [((1 + r)n - 1) / r]

  • FV = future value
  • PV = present value (starting amount)
  • r = interest rate per period (as decimal)
  • n = number of periods
  • PMT = periodic deposit amount

For annuity due (payments at the beginning), multiply the PMT portion by (1 + r).

Two Components

  • FV of lump sum: PV × (1 + r)n — how the initial investment grows
  • FV of annuity: PMT × [((1 + r)n - 1) / r] — how periodic deposits accumulate

Example

You invest $5,000 today and add $150 per period at 7% for 12 periods:

  • Starting amount grows to: $5,000 × (1.07)12 = $11,260.96
  • Periodic deposits accumulate: $150 × [(1.0712 - 1) / 0.07] = $2,681.58
  • Total deposits: $150 × 12 = $1,800
  • Total interest earned: $7,942.54
  • Future value: $13,942.54

Ordinary Annuity vs Annuity Due

FeatureOrdinary Annuity (End)Annuity Due (Beginning)
Payment timingEnd of each periodBeginning of each period
First payment earns interest?No (made at end of period 1)Yes (made at start of period 1)
Future valueLowerHigher (each payment earns one extra period)
Common usesLoan payments, bond couponsRent, insurance premiums, lease payments

Common Applications

  • Retirement savings: How much will my 401(k) be worth with monthly contributions?
  • Education fund: How much to save per month to reach a college tuition target?
  • Investment growth: Project portfolio value with regular contributions
  • Sinking fund: Calculate periodic deposits needed to reach a target future amount

Tips

  • Match rate and period: If periods are months, use a monthly rate (annual rate ÷ 12)
  • Start early: Due to compounding, starting 10 years earlier can double the final value even with the same contributions
  • Account for inflation: Use a real return rate (nominal rate minus inflation) for purchasing-power-adjusted projections

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Frequently Asked Questions

What is the future value formula?

For a lump sum, FV = PV x (1 + r)^n, where PV is the starting amount, r is the rate per period and n is the number of periods. With regular deposits, add PMT x ((1 + r)^n - 1) / r for an ordinary annuity. The rate and the period must use the same time unit.

What is the difference between an ordinary annuity and an annuity due?

In an ordinary annuity, deposits are made at the end of each period, so the first deposit earns no interest in period one. In an annuity due, deposits are made at the start of each period, so every deposit earns one extra period of interest and the future value is higher.

Does compounding frequency change future value?

Yes. More frequent compounding adds interest to the balance more often, so future value rises. $5,000 at 8 percent for 10 years grows to about $10,795 with annual compounding and about $11,098 with monthly compounding. The gap widens with higher rates and longer time horizons.

How do you adjust future value for inflation?

Use the real rate instead of the nominal rate. Subtract expected annual inflation from the expected return: an investment earning 7 percent with 3 percent inflation uses a 4 percent rate. The resulting future value is expressed in the purchasing power of present-day dollars instead of inflated nominal dollars.