end (0 or omitted): Payment is treated as being received or made at the end of each period.
beginning (1): Payment is treated as being received or made at the beginning of each period.
estimate: An optional number value specifying the initial estimate for the rate of return. estimate is a number value and is entered as a decimal (for example, 0.08) or with a percent sign (for example, 8%). If omitted, 10% is assumed. If the default value does not result in a solution, initially try a larger positive value. If this does not result in an outcome, try a small negative value. The minimum value allowed is –1.
Example
Suppose you are planning for your daughter’s college education. She has just turned 3 and you expect she will begin college in 15 years (num-periods is 15*12). You think you will need to have $150,000 (future-value, which is positive because it will be a cash inflow) set aside in a savings account by the time she reaches college. You can set aside $50,000 today (present-value is -50000 because this is a cash outflow) and add $200 (payment is -200 because this is also a cash outflow) to the account at the beginning of each month. Over the next 15 years, the savings account is expected to earn interest monthly (periodic-rate is 0.045/12).
=RATE(15*12, -200, -50000, 150000, 1, 0.1/12) returns approximately 0.376962210924744%, which is per month because num-periods was monthly, or approximately a 4.52% annual rate. Therefore, if the savings account is expected to earn at least this rate over the entire period, it would grow to at least $150,000 over the 15 years.