Future Value Formula
Calculate future value with FV = PV × (1 + r)^n.
Find out how much your investment will be worth at a future date.
The Formula
FV = PV × (1 + r)^n
Future value calculates how much an investment made today will grow to at a specific point in the future. It accounts for the power of compound growth over time.
Variables
| Symbol | Meaning |
|---|---|
| FV | Future value (what the money will be worth later) |
| PV | Present value (the amount you invest today) |
| r | Interest rate per period (as a decimal) |
| n | Number of periods (usually years) |
Example 1
You invest $8,000 today at 7% annual return for 15 years.
PV = $8,000, r = 0.07, n = 15
FV = 8000 × (1 + 0.07)^15
FV = 8000 × (1.07)^15
FV = 8000 × 2.7590
FV = $22,072.00 — Your $8,000 grows to over $22,000 in 15 years.
Example 2
You put $25,000 in a fund earning 5% per year for 20 years.
PV = $25,000, r = 0.05, n = 20
FV = 25000 × (1 + 0.05)^20
FV = 25000 × (1.05)^20
FV = 25000 × 2.6533
FV = $66,332.50 — Your investment more than doubles over 20 years.
When to Use It
Use the future value formula when:
- Planning how much your savings will grow for retirement
- Comparing different investment options over the same time period
- Setting financial goals and determining how much to invest now
- Understanding the long-term impact of different interest rates