Present Value of Annuity Calculator

Your details

Ordinary: payments at period end. Due: payments at period start. Growing: payments increase each period. Perpetuity: payments never stop.
The fixed cash payment received or made each period.
The nominal annual discount or interest rate used to convert future payments to today's dollars.
%
Total number of payment periods (e.g. 20 years of annual payments, or 240 months).
How many times per year interest is compounded. When in doubt, match this to the payment frequency.
How often payments are made or received.
Currency
Present value of annuity
$11,469.92

The lump sum today equivalent to all future payments at the given rate.

Total payments (undiscounted)$20,000.00
Time value of money (discount)$8,530.08
Effective rate per period0.06%
Present value$11,469.92
Time-value discount$8,530.08

Present value is $11,469.92 for this ordinary annuity.

  • The total undiscounted payments sum to $20,000, but discounting at 6% per year reduces that to $11,469.92, a reduction of 42.7%.
  • This is an ordinary (or immediate) annuity: payments arrive at the end of each period. Most mortgages, bonds, and loan repayments follow this structure.
  • The present value is highly sensitive to the discount rate. A rate 1-2 percentage points higher can reduce the present value by 10-20% or more, especially over long horizons.

Next stepTo reverse the calculation and find what payment your lump sum could support, use an annuity payment calculator.

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