Future Value (FV) is the value of a current asset at a specified date in the future based on an assumed rate of growth. The FV equation assumes a constant rate of growth and a single upfront payment left untouched for the duration of the investment.
Formula
The formula used here includes periodic deposits (annuity):
FV = PV * (1 + r)^n + PMT * [ (1 + r)^n - 1 ] / r
Where:
- PV: Present Value (Initial Investment)
- r: Annual Interest Rate (decimal)
- n: Number of Periods (Years)
- PMT: Periodic Deposit Amount