Vavatini

Mobile, Microcomputer, and Web development


 

moneytime Tips and Tricks

A customer posted a comment stating that the Savings feature of moneytime lacks a regular deposit entry. Not really! You can achieve this by using the Annuity page instead. Here's how. You use the compounding periods per year of the savings account. If the principle (your deposit) is compounded monthly, then use a factor of 12. If it's quarterly, use a factor of four.  Here's an example of an account with a quarterly compounding period, an initial opening balance of $1000, an annual interest rate of 2%, and a monthly regular deposit of $300. How much will the balance be after five years?
  1. Go to the Annuity page and in the Periods field enter 20 (5 years X 4 compounding periods).
  2. In the Interest Rate field enter 0.5 (2% ÷ 4 compounding periods).
  3. In the Present Value field, enter -1000 (the initial opening deposit). You enter negative values on the Annuity page for money you provide; positive values represent money you receive.
  4. In the Payment field, enter -900 ($300 monthly deposit X 3 months per compounding period).
  5. The answer, $19,896.10, appears in the Future Value field.
This is a good example of how annuities work in general. Annuities are investments that recieve or pay out sums on a regular basis. A savings account with  compound interest is a form of annuity if your deposits (or withrdrawals) occur on a regular basis with the same amount.

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