Annuity Calculator
Calculate present and future value of ordinary annuity or annuity due with period-by-period tables.
Before you calculate
Values a fixed payment stream mathematically. It is not an insurance quote and excludes mortality credits, rider costs and insurer credit risk.
Annuity Present Value Formula
PMT = periodic payment, r = annual rate, n = number of years. The annuity due factor (1 + r) accounts for payments at the start of each period, making them worth slightly more in present value terms.
PV = PMT × [(1 − (1 + r)^−n) / r] × (1 + r) if annuity dueExample Scenarios
Pension Lump Sum vs Monthly Payments
A pension offering $2,000/month for 20 years at a 5% discount rate has a present value of roughly $302,000. If a lump sum offer exceeds this, the lump sum may be more advantageous.
Lottery Annuity vs Lump Sum
A $1M lottery prize paid as $50,000/year for 20 years has a present value well below $1M due to the time value of money. Compare this to the advertised lump sum to make an informed choice.
Annuity Due Premium
An annuity due is worth slightly more than an ordinary annuity because each payment is received one period earlier, earning an extra period of return.
Methodology & Assumptions
Uses the standard present value of annuity formula. The annuity due variant multiplies by (1 + r) to shift all payments one period earlier.
Sources & calculation notes
Maintained by MoneyCalc. Results are estimates based on the inputs and assumptions shown, not personalized financial advice or a lender quote. Default rates are examples unless a specific tax year or official table is identified.
References explain the underlying concepts or rules. They do not endorse or independently certify this implementation.
Calculations run in your browser. Some tools retain settings on this device. Displayed rounding can produce small differences from a statement or contract.