Last updated October 14, 2026 · Report an error
A dollar received in the future is worth less than a dollar today — the present value of an annuity puts a single, comparable value on a whole stream of equal future payments.
This calculator finds the present value of an annuity from the payment amount, interest rate per period, and number of periods.
How it works
Enter the payment amount per period, the interest rate per period, and the number of periods. The calculator discounts each future payment back to today's value and sums them, using the standard annuity present value formula.
- Enter payment per period.
- Enter interest rate per period (%).
- Enter number of periods.
- Click Calculate to see your results.
Examples
$1,000/year for 10 years at 5%
A $1,000 annual payment for 10 years, discounted at 5%, has a present value of about $7,721.73 — well below the $10,000 in undiscounted total payments.
Who should use it
- Valuing a pension or structured settlement in today's dollars.
- Comparing a lump sum offer against an equivalent stream of payments.
Industry applications
- Finance and investment analysis
- Retirement and pension planning
Advantages
- Shows both the present value and the undiscounted total for comparison.
- Uses the standard, widely-referenced annuity present value formula.
Limitations
- Assumes a constant payment and constant rate for every period.
Common mistakes to avoid
- Mismatching the payment frequency and the interest rate period (e.g., using an annual rate with monthly payments without converting it first).
- Confusing present value (value today) with future value (value at a future date) — they answer different questions.
Best practices
- Make sure the rate you enter matches the payment period exactly (a monthly rate for monthly payments, an annual rate for annual payments) to avoid a mismatched result.
Tips
- A lottery "annuity" payout and its lump-sum alternative can be compared directly using this calculator — just discount the annuity payments at a reasonable rate and compare to the lump sum offered.