Help with TVM Spreadsheet

Assuming that we are talking about annual tuition fee, you would have at first find the tuition fee at start of college from present and then find the net future value of four year tuition fees

Once you have the net future value of four year tuition costs, that amount is called the sinking fund. You would like to have such amount at a future date while your monthly investment earns interest in this case 5% per annum compounded monthly

To find the monthly payment you would have to multiply the four year future tuition fee by a sinking fund factor.

The first of the following two tables shows you how to calculate this

A	B	C	D
1	Current Tuition	$10,000
2	Tuition Growth Rate	2%
3	Years Until College	10
4	College Study Years	4
5	Tuition Fee at Start of College	$12,189.94	=tadFV(B2,,,B3,,-B1)
6	Total Tuition Fee for 4 years	$50,242.17	=tadFV(B2,,,B4,-B5)
7	Target Return Amount	$5,0242.17	=B6
8	Investment Rate	5%
9	Monthly Payment Required	$323.55	=tadSFF(B8,,B3*12,,1/12,1/12)*B7

This second table shows you average increase in tution amount at 2% growth rate

2013	10000
2014	10200
2015	10404
2016	10612.08
2017	10824.32
2018	11040.80
2019	11261.62
2020	11486.85
2021	11716.59
2022	11950.92
2023	12189.94
2024	12433.74
2025	12682.41
2026	12936.06
2023-2026	50242.17

I too had plans to completing my four years degree when I was 18, used to work 14 hours shifts on Gas Stations in Yonkers, NY during summer break to save for the next terms' tuition fee. In the final year of study, the Feds marched in to my life and turned it upside down

Thanks to the Feds that I suffer from life long mental illness and my friend from London thinks I act like the guy in "A Beautiful Mind"

Hey degree, your numbers were a bit off. I don't think you took into account the fact that he would be earning interest while in college.

MoneyMaker, the whole sinking fund thing makes sense. Could you clarify a bit more?

These are the numbers I'm working with (keeping them small so I can put them into a table and check)

Year to college:2
Todays Tuition:10
Annual Tuition Growth Rate:2%
Rate of Return:4%

A	B	C
1	Current Tuition	10
2	Tuition Growth Rate	2%
3	Years Until College	2
4	College Study Years	4
5	Tuition Fee at Start of College	$10.404
6	Total Tuition Fee for 4 years	$42.88
7	Target Return Amount	$42.88
8	Investment Rate	4%
9	Monthly Payment Required	$1.72
10	Annual Withdrawals	$11.36

Monthly deposit of $1.72 will be required for 24 months to achieve a future balance of $42.88 which is the four year tuition fee for years 2015-2018

Assuming that $42.88 is reinvested at 4% rate of return in 2015, you would be able to withdraw an annual amount of $11.36 to deplete all the funds in your account