Future Value - FV- Calculate future cost of funds


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How to calculate the future costs of funds - future value or FV.
Ms. Sud wishes to plan for the future education of her only child. She knows that the present cost of education is Rs.500000 and she estimates that the average inflation in the years will be about 7%. Her child will be ready for higher college education in about 15 years. Now she wishes to calculate the amount of money she'll need for the child's education after 15 years. How can she find this out?
Watch the Excel training video below for the solution:





Once the calculation is completed using the FV function you can perform a what-if analysis by using different investment amounts, inflation rates or number of years.

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