Learn to calculate how much money you can save by making additional payments into your loan.
In this course we'll learn how to use the Financial Loan formulas in Excel to calculate how much money you can save when making additional payments into your loan. We'll also learn to calculate the exact period at which you can pay your loan off. This will really assist you to set achievable goals regarding your outstanding mortgage bond.
This course will take you through a step-by-step guide to create a spreadsheet which details the payment for each period of a loan over the lifetime of the loan. In the example we look at a mortgage bond of 1,500,000 which is paid monthly over 20 years.
The course is created using Excel 2016 and although prior versions of Excel have all the same functionality, the screen may look different so if you are not comfortable using Excel you could get confused. You really should have some basic knowledge of Excel already and you should be able to use formulas and understand how to link cells into formulas.
The topics we cover in the course are:
It is very encouraging to calculate how much you can save on your bond with even small additional amounts!
This lecture covers the PMT function in Excel and by the end of it you will know how to calculate the payment due on a loan provided you know the loan amount, the number of periods and the interest rate.
This lecture covers the IPMT function in Excel and by the end of it you will know how to calculate the amount of interest paid during a given period of the loan.
In this lecture we will look at the PPMT function in Excel and by the end of this you will know how to calculate the amount that is paid towards the principal (or capital) of the loa for a given period. Thus you will know by how much the loan is being reduced for the given period.
In this lecture we will do the initial setup of the spreadsheet that we will be using for the rest of the course. This includes some details of the loan as well setting up headings for the various columns. We'll also create a row for each period of the loan. Here you can follow exactly what I do and set up your own spreadsheet.
In this lecture we learn to use the PMT, IPMT & PPMT functions to calculate the payment for each period of the loan, as well as the interest portion and capital portion. You will also calculate the outstanding balance of the loan for each period until it is paid off. This will give you a detailed overview of your loan payments.
This lecture deals with the effects of additional payments on the loan and in this lecture you will learn to calculate the interest portion of a payment after additional payments have been made.
In this lecture we will use the IF function to add some conditional statements to our calculations. At the end of the lecture we will be able to calculate the exact amount of money that will save after making additional payments. We will also be able to calculate the exact period at which our loan will be paid off.
In this lecture will create a graph showing the Outstanding Capital of the loan for each period; with and without additional payments. This will give you a visual overview of your loan and help you see how additional payments really affect your loan term.
In this final lecture we simply recap on what we have learnt. I really hope to inspire you to set goals for yourself to pay off your loan! This spreadsheet gives you the ability to accurately work towards paying your loan off at a set date.
This bonus lecture will help you to link into a group of like minded people who are interested in being in control of their finances and making wise financial decisions.
I'm a software developer with over 20 years of experience. I live & work in Cape Town (South Africa) and work predominattly in the Financial Industry and generally create systems that manage pension & retirement fund members and their investments. I love coding and finding solutions to problems and my Udemy courses reflect that with useful real-live examples.