Present Value of Annuity Calculator

This calculator works out the present value of an annuity, which is what a series of equal future payments is worth in today's money once you account for the interest rate you could otherwise earn between now and each payment date. It is useful whenever you compare a stream of income, such as payments from a retirement scheme, an insurance settlement or a business earn-out, against a single lump sum offered today. You enter the regular payment received each year, the number of years the payments continue, and the annual interest or discount rate. The calculator assumes an ordinary annuity, meaning each payment falls at the end of its year rather than the start, and it discounts every payment back to today before adding them together. Your result appears as the present value of annuity, a single dollar figure showing what the whole payment stream is worth right now. A higher discount rate or a longer wait before payments start will lower this value, while a higher regular payment or more years will raise it. Use the result to judge whether an offered lump sum is a fair swap for the ongoing payments, or to value a set of future receipts for budgeting and planning. Treat the figure as an indicative estimate, since real-world payments can vary from period to period and are not always guaranteed.

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