Calculating your Equated Monthly Installment (EMI) is very easy to do in Excel. There are numerous online calculators that provide the same functionality. However, in our world, we prefer Excel.

**Equated Monthly Installment (EMI) Math Formula**

Mathematically, the formula for EMI is below. Definitely brings back order of operations.

EMI = [P x R x (1+R)^N]/[(1+R)^N-1]

**E**– EMI**P**– Principal Loan Amount**r**– Rate of interest calculated on monthly basis.**n**– Loan term in Years / Months (Divide by 12 for Months)

**Calculate EMI in Excel**

Excel makes it much easier to calculate EMI by using the PMT Function. Plus, you do not need to pull out your TI-83 calculator. (I had a TI-89 and still do).

=PMT (rate, nper, pv, [fv], [type])

**Rate**: Interest Rate per period**Nper**: The number of periods**Pv**: Present value of loan/investment**Fv**: Future value of the loan/investment – This is optional. If left blank, it will default to zero.**Type**: Defines if the payment is made at the start or end of the period. If left blank, defaults to zero.

0 – Payment is made at the end of the period

1 – Payment is made at the beginning of the period

Let’s look at the following example. Saw were are purchasing a car and need to borrow $15,500 over 3 years at 6.5% annual interest rate. Our EMI would be $475.06 per Month or $5,700.71 year.