Unpaid interest increases the balance
With no repayment, the balance accumulates according to the lump-sum future value formula. A $1,000 debt at 5% annual compounding becomes $1,050 after one year in this simplified model. The added amount is an increased obligation, not investment interest earned for the borrower.
Repayments reduce what can grow next
Optional repayments occur at month end after interest is added. They reduce the outstanding balance for later periods. The final payment is capped at the amount owed, and the model reports payoff rather than generating a negative debt. Unused repayments after payoff are not treated as an investment balance.
Compare with actual loan terms
The tool does not infer a lender’s daily accrual convention, amortization contract, minimum payment, origination charge, late fee or prepayment penalty. Fixed assumptions may not match a variable-rate loan. A balance that grows despite repayments means the entered payment pattern is not covering enough modeled interest and principal.
Questions about this calculation
How can I check the inputs behind the result?
Open “Show calculation & assumptions” for the formula and timing conventions, then inspect the breakdown. Export CSV to keep the last calculated inputs and numerical results together.
Does this include taxes or changing market returns?
No tax calculation or variable market-return path is included. The task-specific assumptions above describe the scope. Calculated values are conditional on the inputs, not personalized recommendations.
Learn more
Start with the step-by-step future value formula guide.
Open the formula guide →How to calculate future value · Spreadsheet calculations · All learning guides
Use these figures to explore assumptions. Actual interest, returns, fees, taxes and purchasing power can differ.