Reverse Interest Calculator

Reverse Interest Calculator calculator can be used to determine the principal amount required to reach a desired future value by providing the future value, interest rate, and time period.

Input Parameters

Calculation Results

Calculation Formula

Principal (P) = Future Value (FV) / (1 + r)^t

Where:
P = Principal amount
FV = Future Value
r = Interest Rate per period
t = Time Period in years

Result

Reverse Interest Calculator Calculator Usage Guide

Learn how to use the Reverse Interest Calculator calculator and its working principles

How to Use the Reverse Interest Calculator

  1. Enter the Future Value (FV) - the amount of money you want to have in the future.
  2. Enter the Interest Rate (r) - the annual interest rate as a percentage.
  3. Enter the Time Period (t) - the number of years until you want to achieve the future value.
  4. Click the Calculate button to find out the principal amount needed.
  5. The result will be displayed in the Principal (P) field.

Example

Suppose you want to have $10,000 in 5 years, and the annual interest rate is 4%. To find out how much you need to invest now:

  • Future Value (FV) = $10,000
  • Interest Rate (r) = 4% = 0.04
  • Time Period (t) = 5 years
  • Principal (P) = $10,000 / (1 + 0.04)^5 = $8,219.27

This means you need to invest $8,219.27 now to have $10,000 in 5 years at a 4% annual interest rate.