Present Value of Annuity Calculator
Value a series of equal payments today.
Inputs
$
%
Result
Present Value$11,469.92
Total Payments$20,000.00
Interest Discounted$8,530.08
About the Present Value of Annuity Calculator
The Present Value of Annuity Calculator tells you what a series of equal future payments is worth in today's money. Use it to price pensions, lease contracts, structured settlements, bond coupons, or any regular cash flow.
Calculation method
The present value discounts each future payment back to today at the chosen discount rate. For an annuity due, payments occur at the start of each period and the ordinary-annuity result is multiplied by (1 + r).
PV = PMT × [1 − (1 + r)^−n] / r (ordinary annuity)
PV_due = PV × (1 + r)How to use this calculator
- Enter the periodic payment amount.
- Enter the discount rate per period (annual rate ÷ periods per year).
- Enter the total number of periods.
- Set annuity-due to 1 if payments occur at the start of the period.
Example
A $1,000 monthly payment for 20 years at a 6% annual discount rate (0.5% per month, 240 periods) has a present value of about $139,581. If paid at the start of each month it rises to roughly $140,279.
Frequently asked questions
What is an annuity in finance?
A series of equal cash flows paid or received at regular intervals — for example a pension payment, loan installment or lease payment.
What is the difference between an ordinary annuity and annuity due?
An ordinary annuity pays at the end of each period; an annuity due pays at the start. Annuity-due present values are always slightly higher because payments arrive sooner.
What discount rate should I use?
Use a rate that reflects the risk and opportunity cost of the payments — often a bond yield, required return, or your loan interest rate.
Disclaimer: This calculator is for informational and educational purposes only and does not constitute financial, tax, or legal advice. Consult a qualified professional for decisions specific to your situation.