💰 Annuity Calculator

An annuity is a series of equal payments made at regular intervals, such as monthly rent, a pension payout, or recurring deposits into a savings plan. The present value (PV) of an annuity tells you what those future payments are worth today given a specific interest rate, while the future value (FV) tells you how much the payment stream will grow to after the final deposit. Understanding both figures is essential for retirement planning, loan analysis, structuring settlements, and comparing insurance products.

There are two main types. In an ordinary annuity (the most common form), payments occur at the end of each period — a typical mortgage or car loan works this way. In an annuity due, payments occur at the beginning of each period, which applies to lease payments and most insurance premiums. Because each payment in an annuity due earns interest for one extra period, its PV and FV are always slightly higher than the ordinary annuity equivalent. Our free annuity calculator handles both structures so you can switch instantly and see the difference.

The annuity calculator applies the standard time-value-of-money formulas used in finance textbooks and by banks worldwide.

Ordinary Annuity (payments at end of period)

Annuity Due (payments at beginning of period)

Where PMT = payment per period, r = interest rate per period (annual rate ÷ periods per year), and n = total number of periods (years × periods per year). The annuity due multiplier (1 + r) accounts for the fact that each payment earns interest for one extra compounding period compared to the ordinary annuity.

Total Contributions and Interest

Total contributions = PMT × n. Total interest = FV − total contributions. These two figures show how much of your final balance comes from your own money versus investment growth.

Future value of $100/month (ordinary annuity, monthly compounding).

What will $100 per month grow to? These examples assume monthly contributions with an ordinary annuity.

1. Enter payment amount — Type the dollar amount of each periodic payment.
2. Enter annual interest rate — Type the nominal annual rate as a percentage (e.g. 5 for 5%).
3. Enter number of years — Type the total duration of the annuity in years.
4. Select payment frequency — Choose monthly, quarterly, or annually.
5. Select annuity type — Choose Ordinary (end of period) or Annuity Due (beginning of period), then click Calculate to see PV, FV, total contributions, and total interest.

What is the difference between an ordinary annuity and an annuity due?

In an ordinary annuity, each payment is made at the end of the period, so the first payment earns no interest during the first period. In an annuity due, each payment is made at the beginning of the period, so every payment earns interest for one extra compounding period. This makes the PV and FV of an annuity due always higher than the ordinary annuity equivalent.

Which interest rate should I use?

Use the nominal annual rate that matches your annuity contract or investment assumption. For a fixed annuity, use the guaranteed rate. For comparing against a portfolio, use a realistic long-term expected return (commonly 5–7% for a diversified stock/bond mix). Never use an overly optimistic rate for retirement planning.

Does this calculator include fees or taxes?

No. This tool computes raw PV and FV based on the rate you enter. Real annuity contracts may carry surrender charges, management fees, and mortality expenses, and payouts are often taxable as ordinary income. Consult a licensed advisor for after-tax figures.

Can I use this for monthly payments?

Yes. Select "Monthly" as the payment frequency and the calculator automatically divides the annual rate by 12 and multiplies the years by 12 to get the correct number of periods.

What happens if the interest rate is 0%?

When the rate is zero, the PV and FV formulas reduce to PMT × n — the total of all payments with no growth. The calculator handles this edge case automatically.

This tool is for informational purposes only and does not constitute financial advice. Consult a qualified financial professional for advice specific to your situation.

When evaluating an annuity, always compare the future value against what the same contributions would earn in an alternative investment such as a low-cost index fund. A fixed annuity paying 3% may preserve capital, but it will not outpace inflation the way a diversified portfolio earning 7% can over 30 years. Likewise, when buying an annuity contract, pay close attention to fees, surrender charges, and whether the payout is fixed, variable, or indexed to a market benchmark. Even a 1% annual fee compounds dramatically over 20 years. Use this present value of annuity calculator to test multiple interest-rate scenarios before signing any contract, and remember that real-world annuities include features (death benefits, joint survivor options, inflation riders) that a simple PV/FV model does not capture.