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ma,

I am trying to find a formula that will let me calculate what percentage my money will need to grow at to reach my goal at the end of ten years, if I start with a certain amount and keep contributing a set amount to that portfolio for each month over the ten-year period. The only growth rate formulas I know deal with a fixed amount growing to another amount--as far as I know, these formulas don't take into account any money that might be donated to the portfolio along the way.

Do you have a financial calculator?

If you know any four of the following you can solve for the fifth:

1. Present Value (PV)
2. Future Value (FV)
3. Periodic Payment (PMT)
4. Nominal Interest Rate (I/YR); and
5. Number of Compounding Periods (N)

I use a Hewlett Packard 10B. Set your calculator appropriately to whether you'll be making payments at the beginning or end of the month. I'll give the symbols that appear on my calculator.

So:

1. Enter your present value (PV)
2. Enter the future value as a negative number (FV)
3. Enter 12 payments per year (P/YR)
4. Enter number of years (xP/YR)
5. Enter amount of monthly payment (PMT), then

6. Solve for nominal interest rate (I/YR)

Hope this helps.

OB