Daily DAX : Day 177 CUMIPMT

 The CUMIPMT function in Power BI's Data Analysis Expressions (DAX) is a financial function that calculates the cumulative interest paid on a loan between two specified periods. It’s particularly useful for financial analysis, such as understanding the total interest burden over time for loans or mortgages.

Syntax

CUMIPMT(rate, nper, pv, start_period, end_period, type)

Parameters:

    rate: The interest rate per period (e.g., annual rate divided by 12 for monthly payments).

    nper: The total number of payment periods in the loan term (e.g., 360 for a 30-year loan with monthly payments).

    pv: The present value, or the initial loan amount.

    start_period: The first period in the range for which you want to calculate the cumulative interest (must be greater than 0).

    end_period: The last period in the range (must be less than or equal to nper and greater than or equal to start_period).

    type: The timing of the payment:

        0 (default): Payments are made at the end of the period.

        1: Payments are made at the beginning of the period.

Return Value

The function returns the cumulative interest paid between the start_period and end_period. The result is typically a negative number because it represents an outgoing cash flow (interest paid).

Use Case

CUMIPMT is commonly used in financial dashboards or reports to:

    Analyze how much interest has been paid over a specific portion of a loan term.

    Compare interest costs across different loan scenarios (e.g., different rates or terms).

    Track the interest component of payments over time, which can help with budgeting or tax deductions (e.g., mortgage interest).

Example Scenario

Suppose you have a $200,000 mortgage with a 6% annual interest rate, paid monthly over 30 years. You want to calculate the total interest paid in the first 5 years (months 1 to 60).

DAX Formula

CumulativeInterest = 

CUMIPMT(

    0.06 / 12,    // Monthly rate (6% annual / 12 months)

    360,          // Total periods (30 years * 12 months)

    200000,       // Loan amount (present value)

    1,            // Start period (month 1)

    60,           // End period (month 60)

    0             // Payment at end of period

)

Result

The function might return a value like -59,123.45, meaning $59,123.45 in interest is paid over the first 5 years. This can be formatted in Power BI to display as a positive number if desired.

Practical Application in Power BI

    Loan Amortization Dashboards: Use CUMIPMT to show how interest accumulates over time, paired with CUMPRINC (cumulative principal) for a full payment breakdown.

    Scenario Analysis: Create measures with different rate or nper values to compare loan options.

    Dynamic Reporting: Combine with slicers (e.g., for start_period and end_period) to let users explore interest costs interactively.

Notes

    Ensure all periods and rates align (e.g., monthly rate for monthly periods).

    The function assumes a fixed-rate loan with consistent payments.

    If parameters are invalid (e.g., start_period > end_period), it returns an error.

This makes CUMIPMT a powerful tool for financial modeling within Power BI! Let me know if you'd like help implementing it in a specific context.