Transcript Loans and Credit Cards

TAKE CONTROL OF
YOUR FINANCES!
http://www.creditkarma.com/
https://www.mint.com
http://newsline.depaul.edu/Info/Pages/FAQsforStudents.asp
x
http://www.creditkarma.com/article/hard_inquiries_and_soft
_inquiries
http://www.oprah.com/money/Suze-Ormans-Advice-forConsolidating-Student-Loans
http://www.finaid.org/loans/consolidationfaq.phtml
PMT Formula
How to set-up an amortization table
in Excel
Beg
End
Balance Payment Interest Principal Balance
Month
0
10,000.00
1. What is the duration of the loan
in months? Type in 0 and then 1.
Select both numbers then drag
down to put in total months.
Setting Up the Formulas
Beg
Month Balance Payment
0
1 =F2
Interest
End
Principal Balance
10,000.00
=PMT(RATE/
12),Months, =B3*0.06/
Loan
12
=C3-D3
=B3-E3
Calculating monthly payment. Put an equal
sign in the cell. Click on Formulas. Click on
Financial. Click on PMT. We need to put in
three numbers followed by a comma
The Bill…
• You have a $1500 balance on a MasterCard that
charges a 19% interest rate
• Minimum payment is 2% or $25
Option 1 – Minimum Payment 2%
Beg
Month Balance
Payment
Principa
Interest
l
0
1
End
Balance
1,500.00
F2
=MAX(B3*0.0
2,25)
=B3*.19/12 =C3-D3
ASSUMPTIONS: 19% Interest Rate,
$1,500 Balance and 2% Payment
=B3-E3
Option 1 – Minimum Payment 3%
Beg
Month Balance
Payment
Interest
Principal
0
1
End
Balance
1,500.00
F2
=MAX(B3*0.0
3,25)
=B3*.19/12 =C3-D3
ASSUMPTIONS: 19% Interest Rate,
$1,500 Balance and 3% Payment
=B3-E
Flat Monthly Payment
• Decide how much you can afford to pay monthly
▫ Has to be more than the minimum
▫ Example: $50 or $100 per month
• Replace the Payment with your choice
• How long will it take to pay off the balance?
• How much interest do you pay?
Option 2 – Flat Amount Payments
Beg
Month Balance
Payment
Interest
Principal
0
1
End
Balance
1,500.00
F2
=50
=B3*.19/12 =C3-D3
=B3-E3
ASSUMPTIONS: 19% Interest Rate,
$1,500 Balance and $50/month Payment
Pay off the Balance in Set Time
• Use PMT function to determine your monthly
payment
▫ Let’s say 2 years
• What will your monthly payment be?
• How much interest do you pay?
Option 3 – Time Payments
Beg
Month Balance
Payment
Interest
Principal
0
1
End
Balance
1,500.00
F2
=PMT(0.19/12,
24,-1500)
=B3*.19/12 =C3-D3
=B3-E
ASSUMPTIONS: 19% Interest Rate,
$1,500 Balance and 24 month duration