Calculation Mode
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Payment Details
Enter payment amounts
Rate & Period
Set interest rate and periods
Annuity Growth Over Time
Watch your annuity grow
Value Breakdown
Payments vs interest earned
Total Payments
$10,000
Principal contributed
Total Interest
$8,393
Interest earned
Annuity Formulas
Understand the calculations
Future Value (Ordinary Annuity):
FV = PMT × [((1 + r)^n - 1) / r]
Present Value (Ordinary Annuity):
PV = PMT × [(1 - (1 + r)^-n) / r]
Annuity Due Adjustment:
Multiply result by (1 + r)
Ordinary vs Annuity Due Comparison
Compare annuity types
| Type | Future Value | Present Value | Difference |
|---|---|---|---|
| Ordinary Annuity | $18,393 | $5,735 | - |
| Annuity Due | $19,496 | $6,079 | +$1,103 |
What if you changed your payment amount?
See how different payment amounts affect your future value
Your Annuity Insights
3 insights based on your inputs
Strong Compound Growth
46% of your future value comes from interest earnings. Compounding is working for you!
Switch to Annuity Due
Paying at the start of each period would earn you an extra $1,103 in interest.
Long-Term Strategy
Over 20 periods, you're maximizing compound growth. Time is your greatest ally.
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Frequently Asked Questions
What is an annuity?
An annuity is a series of equal payments made at regular intervals over a specified period. Annuities can be used for savings (accumulation phase) or for receiving regular income (distribution phase). Common examples include retirement payments and loan payments.
What is the difference between ordinary annuity and annuity due?
In an ordinary annuity, payments are made at the END of each period (like loan payments). In an annuity due, payments are made at the BEGINNING of each period (like rent). Annuity due has a higher future value because payments earn interest for one extra period.
What is future value of an annuity?
Future value (FV) is the total value of all annuity payments plus accumulated interest at a future date. It shows how much your regular savings will grow to. FV = PMT × [((1+r)^n - 1) / r] for ordinary annuity.
What is present value of an annuity?
Present value (PV) is today's value of a series of future payments, discounted at a given interest rate. It answers: "How much money today equals this stream of future payments?" PV = PMT × [(1 - (1+r)^-n) / r].
How do annuities work for retirement?
During accumulation, you make regular contributions that grow tax-deferred. During distribution (retirement), the annuity pays you regular income. Fixed annuities guarantee payments; variable annuities fluctuate based on investments. Consider fees and surrender charges.
How this works
Present and future value of an annuity: PV = PMT × [(1 − (1 + r)^−n) / r]; FV = PMT × [((1 + r)^n − 1) / r]. Handles ordinary annuity (end-of-period) and annuity-due (start-of-period).
What this tool can’t do
When to consult a professional
This is a software engineering tool, not financial advice. Run the math here, then take the result to a certified financial planner, CPA, or your bank before making a decision that materially affects your money.
Sources
- [1]Consumer Financial Protection Bureau (CFPB)Official sourceconsumerfinance.govAccessed Apr 21, 2026
US consumer finance regulator; authoritative on mortgage disclosures, APR rules, credit cards.
Full-stack software engineer specializing in embedded systems, web architecture, and AI/ML. Founder of Practical Web Tools. Built the gesture-controlled drone IP acquired by KD Interactive (Aura Drone, sold on Amazon).