60-Second Skills #6 and #7: Financial Calculators – Future Value and Present Value on HP 12C and HP 17bII+

This is the first in a series of 60-Second Skills related to using financial calculators for real estate analysis.

In today’s post, we will look at the basics of Future Value and Present Value, using a $100 Time Zero amount and an assumed annual growth rate of 4.00%. Follow the input commands on your financial calculator to solve for the Future Value at the end of Year 1 and the Present Value of the Year 2 cash flow.

Here’s a basic Rosetta Stone on the hieroglyphics below:

FIN – Financial functions, TVM – Time Value of Money, PV – Present Value, FV – Future Value, n and N – # of periods, i and I – Annual Interest/Growth Rate, +/- and CHS – change sign

Year 1 Future Value

HP12C Users:

1. f FIN (hold orange f key down and hit x<>y key simultaneously)
2. 100
3. CHS
4. PV
5. 4
6. i
7. 1
8. n
9. FV (answer is $104.00)

HP17bII+ Users:

1. FIN
2. TVM
3. P/YR
4. 1
5. N
6. 1
7. N
8. PV
9. 100
10. +/-
11. PV
12. I%YR
13. 4
14. FV (answer is $104.00)

Year 2 Present Value