Hello,

I have just tried to put together a formula for savings which is attached below.

I have it for such a question

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I put in a lump sum amount of £3,500 into a new account. I also will be paying £900 of my wage per month into this account for 5 years. The gross interest rate will be 5%. How much will I end up with after this time?

where the answer is

γ= £3,500

α= 0.05

t= 5

β= £900

F=((γ)(exp^(αt)))+((β)((exp^(αt))-1)/(exp^(α/12))-1))

F= ((£3,500)(exp^(0.05x5))) + ((£900)(( exp^(0.05x5)) - 1)/( exp^(0.05/12)) -1 ))

F= (3500 x (1.284)) + ((900 x (((1.284) – 1)/((1.004)-1))

F= 4494.089 + (900 x (68.024))

F= 4494.089 + 61221.767

F=£65,715.86

Therefore I will have saved £65,715.86.

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Firstly is this formula correct? Because I have noticed in this calculator SAVINGS CALCULATOR ... I am getting a different figure. I have noticed that this Halifax calculator is missing the final months interest. So the question is, is my formula right? and if so can someone help me in re-arranging this formula, to solve forand to solve fortas it is giving me a headache.β

Thanks alot.