Waterfall Chart in Excel

Running totals are often used in financial applications to track increases and decreases in a balance. They also work well for many other uses. However, running totals can be somewhat confusing to follow if they’re simply presented as numbers. Fortunately, Excel offers a tool called a waterfall chart to visually illustrate running totals. Let’s learn how to add a waterfall chart in Microsoft Excel.

How to Add a Waterfall Chart in Microsoft Excel

Imagine that you have a business, and you want to visually illustrate your current cash balance based on a series of inflows and outflows. For example, you’re starting with $25,000, and plan to take in $31,000 in sales and $2,000 in bonus income. However, you’ll also be spending $18,000 in expenses. A visual aid in the form of a waterfall chart would help illustrate this.

To start adding a waterfall chart in Excel, begin by inputting your data in a basic layout like this. Inflows are positive numbers, while outflows are listed as negative numbers.

Once you’re finished, click and drag to select your data. In this example, it’s contained in cells A1:B4. With the data selected, find the Insert tab up on Excel’s ribbon, and click on it.

Near the center of the Insert tab, in the Charts group, find the Waterfall dropdown button and click on it. Excel will display an array of chart thumbnails. You’ll want to choose the one at the top – again, labeled Waterfall. Click on it.

Excel will automatically insert a waterfall chart onto your spreadsheet. As you can see, it’s an easy visual way to track a running total. With vivid color tones and clear labels, it makes your numbers much easier to understand.

Waterfall charts are an amazing way to track running totals, and by using Microsoft Excel, you can draw them in moments. Give them a try next time you have a balance to illustrate.