Perpetuity Calculator

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Regular: every payment is the same. Growing: each payment is larger than the last by a fixed growth rate.
Choose which variable to calculate. Fill in all the others.
The fixed payment received each period. For a growing perpetuity this is the first payment.
The required rate of return or opportunity cost of capital, expressed as a percentage per period (usually per year).
%
The annual percentage rate at which each payment grows. Must be less than the discount rate for the present value to be finite.
%
Currency
Present Value
$20,000.00

The current lump-sum value of the perpetuity

Effective spread (r - g)0.05%
First-year yield0.05%
Effective spread (r - g)0.05%
First-year yield0.05%

Present value is 20,000.00

  • This is a regular perpetuity with fixed payments. If the discount rate rises, the present value falls, and vice versa.
  • The first-year cash yield is 5.00%. This equals the discount rate for a regular perpetuity, or the spread for a growing one.
  • If the discount rate doubled, the present value would fall to roughly 10,000 - showing how sensitive perpetuities are to rate changes.

Next stepTry switching to a growing perpetuity to model an investment whose payouts increase with inflation or earnings growth.

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