How to calculate future value of car?

simple guide to estimate future value of car

future value of car is :

Future value of the car will tell you the future worth or the future monetary value of your car or simply put it will tell you the cost of your car that will be in future point in time. Future value is a concept of time value of money (TVM) that states that and assets worth increases over time no matter how high or low the intial value of the asset is set. A good example for time value of money would be a bank's saving account where the money grows over time depending on the interest rate set by the bank itself.

Here's how it works, the formula for estimating the future worth of your car depends on variables like the current value which is also known as present value, the interest rate that your car value will have and the number of periods associated with the value.

where FV = future value of the car, PV = present value of the car, r = rate of interest related to car and n = time period associated with value of car.

Take a look at the pie chart to get insights about the distribution across related parameters like present value, monthly rate of interest on the car value, time period applicable on the car value and periodic deposits which is optional if it doesn't apply on your use case. The above future value formula will estimate fv without considering periodic deposits.

Each slice of the pie chart for car fv calculation represents the amount of percent assigned to every variable associated with fv formula for car.

Input the values and click calculate to get the desired result.

This future value of car calculator is not just limited to estimating future value of cars but you can also get future value on any other assets that you want to estimate through this formula.
― Note

just replace the term car with the name of asset of your choice and you will get the fv of that asset.

How to calculate future value when periodic deposits are applied?

Future value with pmt

FV = PMT [(1+(i/100))ⁿ -1/(i/100)] + PV(1+(i/100))ⁿ

Let's say your car costs $15000 currently and you want to know how much would it cost at a certain point in time in future say 2 years later and the interest rate on your car's value is 5.2% the monthly payment associated with it is $2500 which is being applied at the beginning of the period/month. Then 2500 [(1+(5.2/100))² -1/(5.2/100)] + 15000(1+(5.2/100))ⁿ we get $21730.560. The future worth of the car is $21730.560.

Key point to note

Accoring to the concept of time value of money an assets value increases over time and you do not want to get confused by the fact that a vehicle's value would increase too for every car you own. The fv might differ depending on the type of asset in some situations. A car's value is at all time high when it is launched in the market you would be thinking that if worth of the car would increase over time but that is certainly not the case. This is something you should consider before thinking about estimating the future worth of any asset and not just a car.

Bottomline : Time value of money is a major concept of finance and is superset of future value. A set of variables specifically present value (PV), rate of interest (i), Time (n) and Future Value (FV) together as a whole contribute to fundamental structure of Time Value of Money. Credit cards/Debit cards, car loans, home loans, or mortage payments depend almost entirely on time value of money.

How to calculate future value of car?

How to calculate future value when periodic deposits are applied?

Future value with pmt

Key point to note

Category

Related

Unique Car With Monthly Price?