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Calculate how much a current sum of money will be worth in the future at a given interest rate.
FV = PV × (1 + r/n)^(n×t)
Where PV = present value, r = annual rate, n = compounding periods/year, t = years
Future value (FV) is the worth of a current asset at a future date, based on an assumed rate of growth. It shows how much money you will have after a given period if it earns interest.
More frequent compounding results in higher future values. A $10,000 investment at 7% compounded daily yields slightly more than compounded annually over 10 years, though the difference is modest.
Future value projects forward: how much will today's money be worth later? Present value projects backward: what is tomorrow's money worth today? They are inverse calculations using the same formula.
Future value shows how current savings will grow. If you have $50,000 at 45 and earn 7% annually, by 65 you'll have $50,000 × (1.07)^20 ≈ $193,000 — without adding another dollar.
Continuous compounding applies interest infinitely often. The formula becomes FV = PV × e^(r×t). At 7% for 10 years: FV = PV × e^0.7 ≈ 2.01x. It's the theoretical maximum for a given rate.