Have you some idle money in your hands? Do you want to invest it somewhere on a short-term basis? If the answers to these questions are yes, then the money market is the desired solution for you. Here, we will take you through **4** easy and quick steps for creating a money market interest calculator in Excel. So, let’s go through the article to get dominance in the matter.

**Table of Contents**hide

## Download Practice Workbook

You may download the following Excel workbook for better understanding and practice yourself.

## What Is Money Market?

The money market fund is one kind of short-term investment. The difference between the money market and the capital market depends mainly on the time spent on investment. For money market purposes, the term “money” refers to a variety of assets that can be quickly converted into cash. This can be any type of resource. It can include short-term government securities, bills of exchange, or bankers’ acceptances. It entails huge overnight cash transfers between banks and the government. The vast majority of money market transactions are wholesale exchanges between businesses and financial institutions. At last, we can say that one of the foundational elements of the world financial system is the money market.

## 4 Steps to Create Money Market Interest Calculator in Excel

Excel is an obvious tool for our day-to-day activities. We can largely bank on Excel for a myriad of purposes that involve calculations. Here, we’ll create a money market interest calculator in Excel. So let’s explore them step by step.

Here, we have used the *Microsoft Excel 365* version, you may use any other version according to your convenience. If any methods won’t work in your version, then leave us a comment.

### Step 01: Create Basic Outline

First of all, we’ve to construct a basic outline where all the information will exist. It’s simple and easy. Just follow along.

**📌**** Steps:**

- At the very beginning, we built an input range in the
**C4:C5**range. Here, we can insert the**Interest Rate**manually. The**Daily Rate**will be calculated automatically. We’ll see that in a moment. - Then, in the
**F4:F5**range, we created an input area for**Total Days**in a year. Also, we’ve to enter the number of**Days/Month**here. - In the last table, we can see a number of headings. Let’s talk about them. At first, there is the number of Months. Let’s say someone makes a deposit at the start of a month. Then it will be month
**1**. The next month is month**2**and will continue like this. The heading**Contribution**means the first deposit he made at the start of the investment.**Daily Rev**means his daily earnings from the interest. Multiplying it with the number of days per month gives us the**Monthly Rev**. Now, let’s come to the most important thing:**Cumulative Interest**. It means the total running interest also. In easy words, it’s the amount of interest including previous months. We can understand it more clearly in the**last step**.

### Step 02: Determine Daily Interest Rate

As a money market fund is one kind of short-term investment, the interest is calculated on a daily basis. Because the interest rate changes every day. So, we need a daily interest rate to do the calculation. Let’s explore this step by step.

**📌**** Steps:**

- Firstly, we assumed an
**Interest Rate**of**10%**. Basically, this is an annual rate of interest. - Secondly, we considered
**30**days per month and**365**days in a whole year.

Now, we’ll calculate the **Daily Rate** from the above information.

- At this time, go to cell
**C5**and place the following formula into the**Formula Bar**.

`=C4/C5`

Here, we divide the annual interest rate by the number of days in a year, which is **365**. With this calculation, we get the daily rate of interest.

- After that, press the
**ENTER**key.

**Read More:** **How to Calculate Interest Rate in Excel (3 Ways)**

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### Step 03: Calculate Daily and Monthly Revenue

In this step, we’ll compute the daily earnings as well as the monthly income from the investment. So, let’s see the process in detail.

**📌**** Steps:**

- Initially, write down the number of months in order. See the image below to do that easily.

- Then, keep the primary deposit amount in cell
**C8**. In this case, we took it as**50,000**.

`=C8*$C$5`

Actually, we multiplied the deposit amount in cell **C8** with the daily interest rate in cell **C5** to get the **Daily Rev**.

- Following this, press
**ENTER**.

- Next, go to cell
**E8**and paste the following formula into that cell.

`=D8*$F$4`

In this formula, we multiplied the **Daily Rev** in cell **D8** with the number of **Days/Month** in cell **F4**.

- Later, hit
**ENTER**.

**Read More:** **How to Calculate Daily Interest in Excel (2 Easy Ways)**

### Step 04: Compute Total Running Interest

Currently, we’ll learn how to calculate the cumulative interest. In the first month, it’s different from the other months. So, without further delay, let’s dive in!

- Primarily, select cell
**F8**and put the following formula into the cell.

`=$E$8`

That means it gets the corresponding **Monthly Rev** from cell **E8**.

- As usual, tap the
**ENTER**key.

To calculate the second month’s cumulative interest, we’ve to fill in the previous cells.

- Presently, move to cell
**C9**and enter the following formula.

`=C8+E8`

It concludes the monthly revenue of the previous month in cell **E8** with the deposit amount in cell **C8**.

- As always, press
**ENTER**.

*Note:** The interest amount for the second month will be calculated based on this amount in cell C9*.

- Then, calculate the amount of
**Daily Rev**and**Monthly Rev**just like in**Step 03**.

Finally, we can determine the cumulative interest amount for the second month.

- To do this, go to cell
**F9**and write down the following formula.

`=F8+E9`

It interprets that we can get the cumulative interest by adding up the amount of interest for the current month in cell **E9** with the previous month’s cumulative interest in cell **F8**.

- Lastly, tap
**ENTER**.

- At present, bring the cursor to the right-bottom corner of cell
**C9,**and immediately, it’ll look like a plus**(+)**sign. Actually, it’s the**Fill handle**tool. - Now, double-click on it.

- Suddenly, the remaining cells in this column get filled automatically.

*Note:** The results shown are incorrect now. But don’t worry. It will be properly fixed after the completion of the task*.

- Then, do the same for columns
**D**,**E**, and**F**also.

Now, look at the table. It is now perfect with the numbers. The amount in cell **F19** is the final amount of interest gained from the money market account after completing **1** year.

We can get a closer result using the **FV function**. See the image below to grasp the concept properly.

**Read More:** **Calculate Interest in Excel with Payments (3 Examples)**

## Practice Section

For doing practice by yourself, we have provided a **Practice** section like the one below on the right side. Please do it by yourself.

## Free Template: Ready to Use

In this workbook, we have added an extra sheet concluding with a free Money Market** Interest Calculator** template. You can use this in your daily life. Also, you may change or edit it according to your needs. You just have to fill up the **blue-colored** cells. Other calculations will be done automatically.

## Conclusion

This article provides easy and brief solutions to create a money market interest calculator in Excel. Don’t forget to download the **Template** file. Thank you for reading this article. We hope this was helpful. Please let us know in the comment section if you have any queries or suggestions. Please visit our website, **Exceldemy**, to explore more.

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