Microsoft Excel is an incredible productivity tool that can be utilized in a variety of different ways. Often times, Excel is associated with business related use cases. However, Microsoft Excel can be leveraged outside of business as well. There are a large variety of Excel Formulas that Solve Real World Problems. Whether shopping for new loans, reviewing the best investment options for you, or gaining a deeper understanding of your finances, Excel can be a great platform to support you with your personal needs.
To show case how beneficial Microsoft Excel formulas can be for solving real world problems, we picked several that we believe can be extremely beneficial.
Microsoft Excel Formula Examples
PMT – Payment
The (PMT) formula is powerful and simple. Use it to compare loan terms and find out quickly what the actual monthly payment is based on different variations of the loan term. (PMT) helps calculate the payments for a loan based on a constant payment and a constant rate.
One point to know is that the payment calculated by (PMT) includes the principal and interest but omits other items that may be factored into the loan. For example, taxes, reserve payments, or fees are not included in.
FV – Future Value
All investors should understand future value. This formula will come in handy for understanding what your investment will be worth at the end of its term by factoring in compound interest. Think about a certificate of deposit as a great example for utilizing future value. You may want to know what the value of your investment is at the end of the CD term. The future value formula will help you with calculating what your investment will be worth at the end of the CD.
Logical Formulas – IF and AND
When downloading banking transactions to review, the information that is downloaded can often times be difficult to read and analyze. To best organize for easier review, logical formulas can be used to identify overspending opportunities.
The (IF) function allows you to make a logical comparison between a value and what you expect by testing for a condition and returning as a result if that condition is either true or false.
However, to test multiple conditions, (AND) can be included to test all conditions. Use (IF) and (AND) to review your financials and see the different opportunities for managing your personal expenses.
RAND Function
Did you know that Microsoft Excel has it’s very own built in random number generator? The RAND function returns an evenly distributed random real number greater than or equal to 0 and lass than 1. One real world example of using the RAND function is when picking a winner for a raffle. Have a numbered list of names listed on your spreadsheet and use RAND to randomly pick a number from the list. This is a fun and practical use case scenario for the RAND function.
In Summary
If you found this article useful, we are releasing additional articles on Microsoft Excel formulas that will improve your ability to solve real world problems.
Now, if you find that some of these formulas are a little challenging and require too much time to learn, we are here for you.
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