In the future value formula, what does 'T' stand for?

In the future value formula, 'T' represents the number of years, indicating the time period over which the investment will grow. Time is a critical component in calculating future value because it directly affects how much interest is earned on the initial investment.

The longer the money is invested, the more time it has to compound, leading to an exponentially higher future value. This principle underlies the concept of compound interest, where both the interest on the investment and the interest that has previously been added contribute to the total future value. In summary, 'T' denotes the time horizon for the investment, highlighting the importance of time in financial growth and investment strategies.