The future value of an annuity is the total value of a series of recurring payments at a specified date in the future.

Find out how the annuity formula works and how to calculate present and future value. Get a simple breakdown of key concepts.

The present value of an annuity is the current value of future payments from that annuity, given a specified rate of return or discount rate.

The formulas described above make it possible—and relatively easy, if you don't mind the math—to determine the present or future value of either an ordinary annuity or an annuity due.

Find out how the annuity formula works and how to calculate present and future value. Get a simple breakdown of key concepts.

Analyzing the Future Value of an Annuity Updated on: May 2, 2007 / 7:05 PM EDT / MoneyWatch An annuity is a capital investment that pays out a fixed sum at regular intervals over an agreed period.

When planning for retirement, you need to account for the value of any annuities that you own. Trouble is, there’s not just one value of an annuity—there are two: present value and future ...

Present value and future value are two terms you’ll hear used when discussing annuities. In simple terms, the present value of an annuity represents what it’s worth today.

Future Value of Annuity Formula The formula for the future value of an annuity varies slightly depending on the type of annuity. Ordinary annuities are paid at the end of each time period.