Simple Way to Calculate Interest Rate with Excel
To calculate interest rate you will want to know the time interval or in other words the length of the specific financial loan or investment you are looking at.
Next you need to look at the monthly expenses or fees you are supposed to pay each month and of course the third important part in calculating interest rate is the base of your investment or your financial loan.
Once you have all these information you can start calculating your interest rate with Excel. First create any Excel spreadsheet to define the interest rate.
Enter a list of titles such as existing interest, short-term and long-term interest, monthly charges and how many number of payments you will make with this loan. In case you begin in Excel in cell A3 the other titles you will use in cells A4, A5 and A6 respectively.
Now you can enter the info needed in the excel cells towards right of your titles. In case you began in cell A3 as recommended previously, you certainly will enter the financial info in cell B3 all the way to cell B6.
Enter in this formula under the financial info to define the interest rate of your financial loan: =Rate (B6,B5,B3).
Now this simple Excel formula will calculate and show the interest rate for your scenario and you will be able to see exactly how much you need to pay on your investment or financial loan.
This simple excel interest rate calculation will help you better understand the terms of your loan and help you prepare to negotiate your terms better. You will know your exact payments and interest rate so you can do a better financial planning.