How to Make a Waterfall Chart in Excel

Welcome to our guide on how to make a waterfall chart in Microsoft Excel. Waterfall charts are great for visualizing financial statements and comparing changes in values over time. Creating a waterfall chart in Excel may seem like a daunting task, but it can be easily done with a few simple steps. In this guide, we will provide you with step-by-step instructions on how to create a waterfall chart in Excel, as well as tips on formatting and customizing your chart to make it look more professional.

Introduction

If you’re looking to create a waterfall chart in Excel, you’ve come to the right place. Waterfall charts are a great way to visualize the changes in a set of values over a period of time, and they’re commonly used in financial reporting. In this tutorial, we’ll show you how to create a waterfall chart step-by-step, and provide you with some tips to help you customize and format your chart to make it look professional.

Step 1: Set up your data in Excel

The first thing you’ll need to do is set up your data in Excel. You’ll need two sets of data: one for your starting values and one for your changes. Here’s an example:

This is just an example, but your data should be set up in a similar way with each change in a different cell.

Step 2: Create your initial chart

With your data set up, it’s time to create your initial chart. Select the starting values and change data and click on the ‘Insert’ tab in the ribbon. Then, click on the dropdown for chart types and select ‘Waterfall’. Excel will automatically create your waterfall chart based on the data you selected.

Step 3: Format your chart

Now that you have your initial chart, it’s time to format it to make it look more professional. You can make changes to the chart title, axis labels, and font size to make it more readable. Additionally, you can add colors to differentiate between positive and negative values. To do this, click on a section of the chart and click ‘Format Data Series’. From there, you can select ‘Up’ or ‘Down’ to change the colors for positive or negative values respectively.

Step 4: Customize your chart

Finally, if you want to customize your chart even further, you can add additional chart elements like a title, data labels, or a legend. To do this, simply select the chart and click on ‘Chart Elements’ from the ribbon menu. From there, you can add or remove any element you’d like.

Congratulations, you now know how to create a waterfall chart in Excel! With just a few simple steps, you can create a chart that will help you visualize changes in data over time. By formatting and customizing your chart, you can make it look more professional and easy to read. Give it a try and see how it can help you with your financial reporting!

Tips for Creating a Great Waterfall Chart

Here are some additional tips to help you create a more informative and visually appealing waterfall chart in Excel:

Include Contextual Information:

Adding contextual information like total values or percentages to your chart can be helpful for your readers to understand the changes in values better. For example, you can add a line chart or column chart to show total values, or you can add a percentage axis to show changes in percentages over time.

Use Visual Cues:

Using visual cues like colors, shading, and bold fonts to highlight significant changes can make your chart more engaging and easier to read. Use contrasting colors for positive and negative values and make sure the font size and color you choose is legible. You can also use arrows to show the direction of changes.

Keep It Simple:

Although waterfall charts can be elaborate and informative, it’s essential to keep them simple and straightforward. A cluttered and complex chart can be confusing and difficult to understand. So stick to the essential elements and keep your color choices and fonts consistent throughout the chart.

Creating a waterfall chart in Excel can seem daunting initially, but it’s a useful skill to possess, especially for financial reporting. By following the steps outlined in this blog post, you can create a visually appealing and informative waterfall chart quickly. Remember to keep your chart simple, use visual cues, and add contextual information to improve readability and comprehension. Give it a try, and you’ll be amazed at how easy it is to create a professional-looking chart that can impress your audience.

FAQs

Here are some commonly asked questions regarding creating waterfall charts in Microsoft Excel:

Can I create a waterfall chart with negative values?

Yes, you can create a waterfall chart with negative values in Excel. Your chart will show negative values below the x-axis, making it easier to understand the changes in values over time.

Why should I use a waterfall chart instead of a regular line or bar chart?

Waterfall charts are useful when you want to show the changes in values over time. Unlike a regular line or bar chart, waterfall charts show the cumulative effect of changes, making it easier to understand the overall trend.

Can I customize my waterfall chart further than what’s discussed in this blog post?

Yes, you can customize your waterfall chart further by adding additional chart elements like data labels, titles, or axes. You can also change the colors, fonts, and other design elements to make it more professional and meet your requirements.

Can I copy my waterfall chart to another Excel workbook or another program?

Yes, you can copy your waterfall chart to another Excel workbook or another program. Select the chart, press Ctrl+C, and then paste it into the new program or workbook using Ctrl+V.

How do I add contextual information to my waterfall chart?

You can add contextual information to your waterfall chart by adding a line chart or column chart to show total values or a percentage axis to show changes in percentages over time. Simply right-click the chart and select the chart elements you’d like to add.