Future Value Annuity Calculator to Calculate Future Value of Ordinary or Annuity Due

Future Value Annuity Calculator Sign

This online Future Value Annuity Calculator will calculate how much a series of equal cash flows will be worth after a specified number years, at a specified compounding interest rate.

Plus, the calculator will calculate future value for either an ordinary annuity, or an annuity due, and display an annual growth chart so you can see the growth on a year-to-year basis.

Note that if you are not sure what future value is, or you wish to calculate future value for a lump sum, please visit the Future Value of Lump Sum Calculator.

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Future Value Annuity Calculator

Calculate the future value of an annuity for either an ordinary annuity, or an annuity due.

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Selected Data Record:

A Data Record is a set of calculator entries that are stored in your web browser's Local Storage. If a Data Record is currently selected in the "Data" tab, this line will list the name you gave to that data record. If no data record is selected, or you have no entries stored for this calculator, the line will display "None".

DataData recordData recordSelected data record: None
Type:Type of annuity:Type of annuity:Type of annuity:

Type of annuity:

Select the type of annuity. An Annuity Due indicates payments are received at the beginning of each period, whereas an Ordinary Annuity indicates payments are received at the end of each period.

Frequency:Frequency:Deposit/Payment Frequency:Deposit/Payment Frequency:

Deposit/Payment Frequency:

Select the payment/deposit interval.

Amount:Dep/pmt amount:Deposit/ payment amount:Deposit/ payment amount:

Deposit/ payment amount:

Enter the corresponding payment/deposit amount for the selected interval (without dollar sign or comma).

# of yrs:# of years:Number of years:Number of years to calculate future value:

Number of years to calculate future value:

Enter the number of years you would like to calculate future value for.

Rate:Interest rate:Annual interest rate:Annual interest rate:

Annual interest rate:

Enter the annual interest rate to be used for the future value calculations. Please enter as a percentage but without the percent sign (for .06 or 6%, enter 6). Note that the future value annuity calculator will convert the annual interest rate to the rate that corresponds to the payment frequency. For example, if you selected a monthly payment frequency, the future value annuity calculator will divide the annual rate by 12.

FV:Future Value:Future value of an annuity:Future value of an annuity:

Future value of an annuity:

Based on your entries, this is the future value of the annuity you entered information for.

Dep/pmts:Total dep/pmts:Total payments/deposits:Total of annuity payments/deposits:

Total of annuity payments/deposits:

Based on your entries, this is the total of the annuity payments for all periods.

Int earned:Interest earned:Compound interest earned:Compound interest earned on annuity:

Compound interest earned on annuity:

Based on your entries, this is how much compound interest will be earned on the invested annuity payments. This result also represents the financial opportunity cost of spending the periodic payment on non-essential expenditures that lose their value with time and/or use (depreciable assets and expendables).

If you would like to save the current entries to the secure database, tap or click on the Data tab, select "New Data Record", give the data record a name, then tap or click the Save button. To save changes to previously saved entries, simply tap the Save button. Please select and "Clear" any data records you no longer need.

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Help and Tools

Learn

What an annuity is and why it's important.

What is "Annuity?"

An annuity is defined as a series of equal cash amounts (cash flows, payments, deposits, etc). For example, if I were to promise to pay you $100 per year for the next 3 years, that arrangement could be considered to be an annuity.

From your perspective, the periodic amounts represent deposits, as in, you can deposit the amounts into an interest earning account as you receive them.

From my perspective, the periodic amounts represent payments, as in, I must remove the amounts from an interest earning account in order to pay them to you.

This explains why annuity amounts (cash flows) can be referred to as deposits and payments at the same time.

What is Future Value of An Annuity?

Using the above example, if you were to invest each of the $100 annual payments at a compounding interest rate (earning interest on interest paid), the future value of that series of cash inflows would grow with each passing compounding and payment interval.

The total amount that series of equal amounts would grow to after three years would be the future value of the annuity.

So what would be the future value amount? That depends on the agreed upon interest rate and on whether or not we agreed to an ordinary annuity or to an annuity due.

Annuity Due Vs. Ordinary Annuity

Continuing with our example, if I agreed to make the $100 annual payments at the beginning of each year, our arrangement would be considered to be an annuity due.

On the other hand, if I made the payments to you at the end of each year, our arrangement would be considered to be an ordinary annuity.

So which is better? From your perspective, an annuity due would be better since you could earn interest on the first year's payment for the entire year.

From my perspective, an ordinary annuity would be better since I could earn interest on the $100 for a full year before I made the payment to you.

So in your case, if you were earning an annual interest rate of 6% on the deposited $100 payments, the future value of an annuity due arrangement would be $337.46, whereas the future value of an ordinary annuity arrangement would be $318.36 ($19.10 less).

Why is Future Value of An Annuity Important for You to Understand?

The understanding of future value, both for lump sums and for annuities, is absolutely critical to making financial decisions that will serve to maximize the emotional returns on the money you earn.

Why? Because in order to make emotionally profitable decisions (decisions that result in more good feelings that bad feelings), you need to be aware of, and be able to accurately forecast, what you are giving up in return for what you are getting.

In terms of spending money, what you give up is referred to as financial opportunity costs, and future value calculations are what helps you to determine the financial opportunity costs of choosing one alternative financial decision over another.

And of those alternatives, the ones that tend to have the biggest effects on your emotional profitability, are those that involve spending money for non-essential expenditures that lose their value with time and/or use.

Example of Opportunity Cost Using Future Value Calculations

Suppose you are considering entering into a data plan for your smart phone that will cost you $35 per month. In order to make an informed decision, you need to be aware of and give equal weight to the financial opportunity costs that will come with a monthly expenditure of $35.00 for a non-essential expendable.

If you have at least 30-years left before you can retire, and could earn 6% on the $35 payments if you invested them, future value calculations will tell you that the financial opportunity cost of paying for a data plan for the next 30-years will be $22,733.82 (future value of $35,333.82 less $12,000.00, or 360 payments @ $35). That is how much interest earnings you will be giving up by paying for the data plan for the next 30-years (of course, your loss will be the data plan company's gain).

And that's only considering just one of the possible hundreds of the non-essential expenditures you likely make on a regular basis. After all, if you spend more for an essential than the bare minimum necessary (buying non-generic, paying finance charges on purchases, paying inflated prices, etc.), then these excess essential expenditures should be considered to be non-essentials as well.

The bottom line is, the only way to make wise financial decisions is to be able to accurately weigh what you are giving up in exchange for what you are getting. Understanding annuities (and other Time Value of Money principles) is critical to that process.

Adjust Calculator Width:

Move the slider to left and right to adjust the calculator width. Note that the Help and Tools panel will be hidden when the calculator is too wide to fit both on the screen. Moving the slider to the left will bring the instructions and tools panel back into view.

Also note that some calculators will reformat to accommodate the screen size as you make the calculator wider or narrower. If the calculator is narrow, columns of entry rows will be converted to a vertical entry form, whereas a wider calculator will display columns of entry rows, and the entry fields will be smaller in size ... since they will not need to be "thumb friendly".

Show/Hide Popup Keypads:

Select Show or Hide to show or hide the popup keypad icons located next to numeric entry fields. These are generally only needed for mobile devices that don't have decimal points in their numeric keypads. So if you are on a desktop, you may find the calculator to be more user-friendly and less cluttered without them.

Stick/Unstick Tools:

Select Stick or Unstick to stick or unstick the help and tools panel. Selecting "Stick" will keep the panel in view while scrolling the calculator vertically. If you find that annoying, select "Unstick" to keep the panel in a stationary position.

If the tools panel becomes "Unstuck" on its own, try clicking "Unstick" and then "Stick" to re-stick the panel.