An annuity is any series of equal (or steadily growing) payments. An ordinary annuity pays at the end of each period, an annuity due at the start – which earns one more period of interest.
How to use the Annuity Calculator
- Payments are
- Starting balance
- Payment per period
- Annual interest rate
- Number of years
- Payment frequency
- Compounding frequency
- Payments made at
- Growth of payments per year
- Target final balance
Results update as you type, and every field accepts the units shown in its menu.
How it works
Choose deposits or withdrawals, then enter the starting balance, payment, frequency, timing, length, rate, compounding, payment growth and an optional target.
Tips
- Start early – time does more of the work than the amount you save.
- Take the full employer match if your plan offers one.
- Plan with a cautious return (4–6% after inflation) and check again every year.
- Know the contribution limits and required minimum distribution rules for your accounts.
Common mistakes to avoid
- Ignoring inflation when setting a retirement target.
- Underestimating how long retirement can last.
- Withdrawing early and paying penalties and taxes.
Inputs explained
| Field | What to enter |
|---|---|
| Payments are | Choose one: Deposits, Withdrawals |
| Starting balance | Amount in your currency |
| Payment per period | Amount in your currency |
| Annual interest rate | In % |
| Number of years | Units: years, months |
| Payment frequency | Choose one: Monthly, Semi-monthly, Bi-weekly, Weekly … |
| Compounding frequency | Choose one: Yearly, Semi-annually, Quarterly, Monthly … |
| Payments made at | Choose one: End of each period, Beginning of each period |
| Growth of payments per year | In % |
| Target final balance | Amount in your currency |
What each result means
- Number of payments = round([Number of years]×[Payment frequency])
- Final balance = [Starting balance]×(1 + [Rate per payment period])^[Number of payments] + [Payments are]×gfv([Rate per payment period], [Number of payments], [Payment per period], [Payment growth per period], [Payments made at])
- Total interest = [Final balance] – [Starting balance] – [Payments are]×[Total payments]
- Deposit needed per period for the target = max(([Target final balance] – [Starting balance]×(1 + [Rate per payment period])^[Number of payments])÷gfv([Rate per payment period], [Number of payments], 1, [Payment growth per period], [Payments made at]), 0)
Example values
How the main result changes when Starting balance changes and everything else stays at the example values above:
| Starting balance | Final balance |
|---|---|
| 5,000 | 155,163.29 |
| 7,500 | 163,438.8 |
| 10,000 | 171,714.31 |
| 12,500 | 179,989.82 |
| 15,000 | 188,265.34 |
| 20,000 | 204,816.36 |
Formula
Rate per period i = (1 + r ÷ m)^(m ÷ f) − 1Final balance = B(1 + i)^n ± P × ((1 + i)^n − (1 + g)^n) ÷ (i − g) × (1 + i × timing)Payment for a target = (target − B(1 + i)^n) ÷ annuity factorWorked example
Inputs — Payments are: Deposits; Starting balance: $10,000; Payment per period: $300; Annual interest rate: 6 %; Number of years: 20 years; Payment frequency: Monthly; Compounding frequency: Monthly; Payments made at: End of each period; Growth of payments per year: 0 %; Target final balance: $250,000.
Results — Number of payments = 240; Final balance = $171,714.31; Total payments = $72,000.00; Total interest = $89,714.31; Deposit needed per period for the target = $469.43.
Frequently asked questions
What is an annuity?
A series of equal payments at regular intervals.
What is the difference between an ordinary annuity and an annuity due?
Ordinary pays at the end of each period; due pays at the start.
Is this the same as an insurance annuity?
The maths is the same; insurance annuities add fees and guarantees.
What formula does the Annuity Calculator use?
Rate per period i = (1 + r ÷ m)^(m ÷ f) − 1.