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Thread: How to calculate daily compound interest

  1. #11
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    Default Re: How to calculate daily compound interest

     
    Quote Originally Posted by wmlbrn View Post
    Thank you - that is exactly what i needed
    wouldn't let me edit the previous one but here is the formula i used.

    =A1*(1+B2)^182

    A1 is the principal
    b2 is the interest amount - that way i can play with it and see what differences a small amount makes over a 10 year period. Thanks a bunch

  2. #12
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    Default Re: How to calculate daily compound interest

    If you want to use a function, check help for FV.

    =FV(0.0075,182,,-10000)

    This should give the same result as the strictly math calculation.

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    Default Re: How to calculate daily compound interest

    Hi Guys....this is what I figured it out:

    Daily Interest Compound formula: Amount*(((1+(Interest rate/number of days in a year))^number of days in a month)-1)

    For ex:

    Non Leap Year - 2013
    Principal Amt Due: $700,000
    Annual Interest rate: 0.069959 6.9959
    Number of days in a Year: 365
    Interest Calculation period: Jan-2013
    Daily Compound formula: Amount*(((1+(Interest rate/number of days in a year))^number of days in a month)-1)
    $700,000*(((1+(0.069959/365))^31)-1)
    Date Principal Amt Intrerest rate Daily Interest Occumulated Interest
    2013-01-31 $700,000.00 0.069959 $4,171.19 $4,171.19
    2013-02-28 $704,171.19 0.069959 $3,788.88 $7,960.07
    2013-03-31 $707,960.07 0.069959 $4,218.62 $12,178.69
    $12,178.69

    Leap Year - 2012
    Principal Amt Due: $700,000
    Annual Interest rate: 0.068896 6.8896
    Number of days in a Year: 366
    Interest Calculation period: Oct-2012
    Daily Compound formula: Amount*(((1+(Interest rate/number of days in a year))^number of days in a month)-1)
    $700,000*(((1+(0.068896/366))^31)-1)
    Date Principal Amt Intrerest rate Daily Interest Occumulated Interest
    2012-10-31 $700,000.00 0.068896 $4,096.37 $4,096.37
    2012-11-30 $704,096.37 0.068896 $3,987.05 $8,083.43
    2012-12-31 $708,083.43 0.068896 $4,143.68 $12,227.10
    $12,227.10

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    Default Re: How to calculate daily compound interest

    Is there a way to be able to change the daily interest rate for each day if the daily rate of interest was different for the principal amount for each day individually?

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    Default Re: How to calculate daily compound interest

      
    Quote Originally Posted by BigDaddyKane View Post
    Is there a way to be able to change the daily interest rate for each day if the daily rate of interest was different for the principal amount for each day individually?
    Yes. But the devil is in the details, which you provide none of.

    Provide a concrete example with numbers, terms of deposit (e.g. compounding frequency), and expected spreadsheet design (layout), if any.

    WTTW.... Start a new thread with those details. Do not piggyback an old thread, much less one that is nearly 5 years old.

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