Excel University Blog
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Functions
When assessing whether an investment is financially worthwhile, smart investors don’t guess … they measure. Excel has multiple functions that can measure an investment’s net present value. Excel’s classic net present value function, NPV, assumes cash flows occur at regular intervals. But what do we do when the cash flow timing is irregular? That’s where…
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Welcome! In today’s post, we’ll walk through the concept of Net Present Value (NPV) and how to calculate it accurately in Excel. If you’ve ever wondered how to measure whether an investment is worth it, NPV is one of the most practical tools you can use. But, as with many financial functions, there’s a catch.…
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Understanding interest rates is key to accurate financial modeling in Excel. In this guide, we’ll explore the NOMINAL function, which helps us convert an effective rate (APY) into a nominal rate (APR). Once we make this conversion, we can generate more precise projections using Excel’s other financial functions like FV (Future Value) and PMT (Payment).…
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When evaluating loans or investments, we’re often presented with a nominal interest rate commonly known as the APR (Annual Percentage Rate). But what we really care about is how much we’ll actually earn or pay over time, and that’s where the effective annual rate (APY) comes in. Fortunately, Excel offers the EFFECT function to convert…
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When it comes to understanding the full cost of a loan, knowing just the monthly payment isn’t enough as the interest paid over time can be significant. That’s where Excel’s powerful CUMIPMT function comes into play. In this post, we’ll walk step-by-step through how to calculate cumulative interest over a given loan period and explore…
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Understanding the principal portion of your loan payments over time is a key step in financial modeling and reporting. Fortunately, Excel makes this process easy with the CUMPRINC function. In this blog post, we’ll take a detailed look at how the CUMPRINC function works, build a cumulative principal schedule, and ultimately construct a simple dynamic…
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If you’re managing loans or curious about how much interest you’re paying each month, Excel’s IPMT function is here to help. In this post, we’ll not only explore how the function works, but we’ll also take it further by building a fully dynamic loan amortization schedule—one that updates automatically when you change any loan inputs.…
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Managing loans and tracking monthly payments just got a whole lot easier. In this tutorial, we’ll explore the PPMT function in Excel—a lesser-known but incredibly powerful function that calculates the principal portion of a loan payment for a specific period. Even better, we’ll show how to transform this function into a fully dynamic loan amortization…
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Imagine having a financial crystal ball—something that gives us a glimpse into how our money could grow into the future. That’s exactly what Excel’s FV (Future Value) function offers. Whether we’re saving for retirement, planning an investment, or just trying to hit a savings goal, FV gives us the power to explore different scenarios and…
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Understanding the concept of present value can be one element in our financial decision making process. From evaluating loans and subscriptions to complex financial instruments like reverse mortgages, Excel’s PV function provides an accessible, effective tool for comparing future payments in today’s dollars. In this post, we’ll explore how to use the Excel PV function…
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