# Growing Annuity Calculator

URL: https://speedycalculator.com/calculators/finance/growing-annuity/
Last updated: 2026-10-25

> The growing annuity calculator works out the present value and future value of a series of payments that grow at a constant rate – such as rising salary contributions, rents or pension payments with cost-of-living increases.

## Inputs

- First payment
- Growth rate per period (%)
- Interest rate per period (%)
- Number of periods
- Payments made at

## Results

- Present value
- Future value
- Last payment
- Total payments

## Formula

```
PV = P₁ × (1 − ((1 + g) ÷ (1 + r))^n) ÷ (r − g)
FV = P₁ × ((1 + r)^n − (1 + g)^n) ÷ (r − g)
If r = g: PV = n × P₁ ÷ (1 + r)
```

## Explanation

Growing annuities model anything that increases steadily. If the growth rate exceeds the discount rate, the present value grows with every extra payment – which is why a perpetuity needs r > g.

### How to use the Growing Annuity Calculator

- **First payment**
- **Growth rate per period**
- **Interest rate per period**
- **Number of periods**
- **Payments made at**

Results update as you type, and every field accepts the units shown in its menu.

### How it works

Enter the first payment, the growth rate per period, the interest (discount) rate per period, the number of periods and the timing.

### 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

FieldWhat to enterFirst paymentAmount in your currencyGrowth rate per periodIn %Interest rate per periodIn %Number of periodsA numberPayments made atChoose one: End of each period, Beginning of each period

### What each result means

- **Present value** = gpv([Interest rate per period]÷100, [Number of periods], [First payment], [Growth rate per period]÷100, [Payments made at])
- **Future value** = gfv([Interest rate per period]÷100, [Number of periods], [First payment], [Growth rate per period]÷100, [Payments made at])
- **Last payment** = [First payment]×(1 + [Growth rate per period]÷100)^([Number of periods] - 1)

### Example values

How the main result changes when **First payment** changes and everything else stays at the example values above:

First paymentPresent value5008,535.8875012,803.821,00017,071.751,25021,339.691,50025,607.632,00034,143.51

## Worked example

Inputs — First payment: $1,000; Growth rate per period: 3 %; Interest rate per period: 6 %; Number of periods: 25; Payments made at: End of each period.

Results — **Present value = $17,071.75**; Future value = $73,269.76; Last payment = $2,032.79; Total payments = $36,459.26.

## FAQ

**What is a growing annuity?**
Payments that increase at a constant rate each period.

**What if growth equals the interest rate?**
PV = n × P₁ ÷ (1 + r).

**Where are growing annuities used?**
Pensions with COLAs, rising savings plans and valuing growing cash flows.

**What formula does the Growing Annuity Calculator use?**
PV = P₁ × (1 − ((1 + g) ÷ (1 + r))^n) ÷ (r − g).