When you’re done, it should look something like this: It’s useful to provide a separate cell for each variable, in case we need to change the values later. Our first step is building a neat table to collect all this information. How much money is she borrowing? What is the interest rate, usually represented as an annual percentage rate (APR)? Finally, how long will she be borrowing the money, also known as the term? Finally, there are the details of the loan. She also might have a car to trade-in (or sell). She might have some cash on hand to use for a down payment. In this case, we are building a car loan calculator, so we have to think about what variables the car buyer is working with. The first step of many new financial models is data collection. Before we hand over the hard lifting to our favorite spreadsheet program, however, we have to decide what we are going to tell it. It has functions that specialize in figuring out payment schedules, calculating interest due, etc. In many ways, Excel was designed with finance calculations in mind. Google “Car Loan Calculator” and you’ll find no fewer than 31 million results! But with a few basic formulas and an Excel worksheet, you can make a payment calculator that better and more powerful than the majority of those online! Think you’re ready to start putting your Excel skills to use? Let’s get started! Calculating the payments for a car loan is a pretty basic financial exercise. You’ve been learning individual Excel functions and quick tips to improve your work, but now it’s time to put them together to make a functional tool. 2Making the Calculation with the PMT() Function.