RATE Function in Google Sheets

Calculate the interest rate per period of an annuity, given the number of periods, payment, present value, and future value.

RATE Function

The RATE function in Google Sheets calculates the interest rate per period of an annuity, given the number of periods, payment per period, present value, and future value.

Syntax

RATE(number_of_periods, payment_per_period, present_value, [future_value], [end_or_beginning], [rate_guess])
  • number_of_periods: The total number of payment periods.
  • payment_per_period: The amount paid in each period.
  • present_value: The present value of the loan or investment.
  • future_value: (Optional) The desired future value of the loan or investment. Default is 0.
  • end_or_beginning: (Optional) Indicates when payments are due. 0 for end of the period, 1 for beginning.
  • rate_guess: (Optional) Your guess for what the rate will be. Default is 0.1 (10%).

Examples

  1. Basic Interest Rate Calculation

Calculate the interest rate for a loan with monthly payments:

=RATE(60, -200, 10000)

This will output 0.03 or 3%.

Notes

  • Useful for determining the interest rate when payments are fixed.
  • The result is an interest rate per period.
  • PMT: Calculate the payment for a loan based on constant payments and a constant interest rate.
  • FV: Calculate the future value of an investment based on periodic, constant payments.