Enter the values in the Present Value of Annuity calculator:
Payment per period (PMT):
Interest rate in % (r):
Number of periods (n):
How to use the Present Value of Annuity Calculator
Let’s review a simple example where the goal is to derive the Present Value of Annuity given the following information:
- Payment per period (PMT) = 8000
- Interest rate (r) = 6%
- Number of periods (n) = 12
Enter the values in the calculator:
Finally, click on the “Calculate Present Value of Annuity” button, and you’ll get the result of 67070.7515:
How to Manually Calculate the Present Value of Annuity
You may use the formula below in order to derive the Present Value of Annuity:
PMT * [1 - 1/(1 + r)n]
Present Value of Annuity = r
Where:
- PMT = Payment per period
- r = Interest rate
- n = Number of periods
For example, suppose that you’d like to calculate the Present Value of Annuity given the information below:
- Payment per period (PMT) = 8000
- Interest rate (r) = 6%
- Number of periods (n) = 12
Once you plug those values in the formula, you’ll get the result of 67070.75:
PMT * [1 - 1/(1 + r)n] 8000 * [1 - 1/(1+0.06)12]
Present Value of Annuity = r = 0.06 = 67070.75
To calculate the Future Value of Annuity, you may check the Future Value of Annuity calculator.