Can you afford that new car? Or maybe you loaned money to one of your kids, and you want to calculate a repayment schedule. (Oh yes, they will stick to the plan, without fail.)
To help you figure out the payment amounts, here is a nifty Excel loan payment calculator. (The kids will think you’re cool when you say “nifty”.)
It uses the PMT function to calculate the payment amount, and you can enter the variables:
- Loan Amount
- Payment Frequency
- Term (Years)
- Annual Interest Rate
How the Loan Payment Calculator Works
Of course, if you are the Bank of Dad, you might offer a lower interest rate, so you can adjust any, or all, or the green cells.
Type in any cell, except Payment Frequency, where you can select from a drop down list of options.
The Lists sheet has a lookup table of frequencies and number of payments.
Based on the frequency that you select, a number of payments per year is calculated in cell E5, using a VLOOKUP formula.
The payment amount is calculated with the PMT function:
I added a minus sign before the present value variable, so the monthly payment is shown as a positive number. You can omit the minus sign, to show the payment as a negative number.
Download the Excel Loan Payment Calculator
To see the formulas, and experiment with the calculator, you can download the Excel Loan Payment Calculator sample workbook. The file is in Excel 2007 format, and zipped. The calculator uses the IFERROR function, so you’ll need to change that if using an earlier version of Excel.
If you have any comments, or suggestions for enhancing the calculator, please let me know in the comments. Thanks!