Endowment Growth Calculator

Formula

The formula to calculate the Future Value (FV) of an endowment is:

\[ FV = P \times (1 + r)^n \]

Where:

Endowment Growth: The increase in value of an endowment fund over time due to investment returns. Endowments are funds that are invested to generate income, often for non-profit organizations, universities, or charities.
Initial Principal (P): The starting amount of money in the endowment.
Annual Growth Rate (r): The yearly rate at which the endowment grows, expressed as a decimal.
Number of Years (n): The period over which the endowment grows.

Let's say the initial principal is $100,000, the annual growth rate is 5%, and the number of years is 10. Using the formula:

\[ FV = 100000 \times (1 + 0.05)^{10} \]

We get:

\[ FV \approx 162,889.46 \]

So, the future value of the endowment is approximately $162,889.46.