wikiHow Maturity Value Calculator Maturity value is the amount of money that a financial instrument, such as a bond or a certificate of deposit (CD), will be worth when it reaches its maturity date. The maturity value is calculated based on the principal amount, the interest rate, and the length of time until the instrument reaches maturity. The formula to calculate maturity value is: Maturity Value = Principal x (1 + (Interest Rate x Time)) Where: Principal is the original amount of money invested or borrowed Interest Rate is the annual interest rate expressed as a decimal Time is the length of time until the instrument reaches maturity, expressed in years Here are the steps to calculate maturity value: 1. Determine the principal amount of the financial instrument, which is the initial amount invested or borrowed. 2. Determine the annual interest rate, which is the rate at which interest is earned or charged on the principal amount. 3. Determine the length of time until the instrument reaches maturity, expressed in years. 4. Convert the annual interest rate to a decimal by dividing it by 100. 5. Multiply the interest rate by the length of time to get the total interest earned or charged. 6. Add 1 to the interest rate multiplied by time. 7. Multiply the principal amount by the result of step 6 to calculate the maturity value. For example, let's say you invest $10,000 in a 5-year CD with an annual interest rate of 2.5%. To calculate the maturity value, you would use the following formula: Maturity Value = Principal x (1 + (Interest Rate x Time)) Maturity Value = $10,000 x (1 + (0.025 x 5)) Maturity Value = $10,000 x (1 + 0.125) Maturity Value = $10,000 x 1.125 Maturity Value = $11,250 Therefore, the maturity value of the CD is $11,250 at the end of the 5-year term. Page