Excel: Computing Regular Deposits for a Specified Future Amount?

Question

I had tried to run some example from my calculator on excel. I cannot get the correct answer of 203.13. Can someone try to pinpoint the error in my formula? You plan to open a savings account and deposit the same amount of money at the beginning of each month. In 10 years, you want to have $25,000 in the account. How much should you deposit if the annual interest rate is 0.5% with quarterly compounding? FV  25000 NPER 10 RATE 0.50%   PMT ($193.23) =PMT(RATE/4, NPER*12,,FV)

Answer 1

The formula you entered is compounding every month, not every quarter, which earns you an additional .5% each year.

Something like =pmt(RATE/4,NPER*4,0,25000)/3 gets you closer to the answer you wanted. This means you pay January 1, February 1, and March 1, then when you pay April 1 the interest for your first 3 payments is added to the balance.

The answer you wanted assumes you pay January 1, February 1, and when you make your March 1 payment, the interest for your first 2 payments is added to the balance, but I can't immediately think of how to use the PMT function to arrive at that exact answer.