Calculate interest for regular payments

**Jonmp** · 04-01-2011, 04:02 PM

Hi,

I'm trying to work out what the equivalent interest would have been (annualised interest?) on a regular investment I make.

Each month I invest £500 and after 11 payments my investment is worth £6000. What annual interest rate (paid monthly) would have given the same result?

All the functions I can find seem to require either the interest rate up-front of just a single payment.

Any help anyone?

**shg** · 04-01-2011, 04:11 PM

Welcome to the forum.

=RATE(11, -500, 0, 6000) ~ 1.73%

**Jonmp** · 04-01-2011, 04:26 PM

Thanks for the quick reply. However I am still confused.

If I had invested £5500 at the start of the period and got £6000 at the end the interest rate would have been 8%. Is the 1.73% a monthly interest rate? If it is how do I convert it to an annual one? In other words what regular savings account annual interest rate would have given the same return?

Thanks for your help.

I have to go now so I will look at the forum again tomorrow - I'm not ignoring replies!

Jon