Future Value of Annuity Calculator

What is Future Value of Annuity?

The Future Value of an Annuity (FVA) is the total accumulated value of a series of equal payments made at regular intervals, invested at a given interest rate, at some point in the future. It shows how much your regular deposits will grow over time through the power of compound interest.

Annuities are common in everyday financial planning: regular contributions to retirement accounts (401k, IRA), monthly savings deposits, lease payments, insurance premiums, and loan payments are all examples of annuities.

Types of Annuities

There are two main types of annuities based on when payments are made:

• Ordinary Annuity (Annuity in Arrears): Payments are made at the end of each period. This is the most common type, including loan payments, bond coupon payments, and most savings contributions.
• Annuity Due: Payments are made at the beginning of each period. Examples include rent payments, insurance premiums, and lease payments.

The FVA Formula

For payments made at the end of each period (ordinary annuity):

$$FVA = C \times \frac{(1 + r)^n - 1}{r}$$

For payments made at the beginning of each period (annuity due):

$$FVA_{due} = C \times \frac{(1 + r)^n - 1}{r} \times (1 + r)$$

Where:

• C = Payment amount per period
• r = Interest rate per period (as a decimal)
• n = Number of periods

How to Use This Calculator

Enter your regular payment amount, the interest rate per period, the total number of periods, and select whether payments are made at the beginning or end of each period. The calculator will show the future value of your annuity, total contributions, total interest earned, and a detailed payment schedule showing period-by-period growth.

Practical Applications

FVA is essential for retirement planning. If you contribute $500 per month to a retirement account earning 7% annually for 30 years, your total contributions of $180,000 could grow to over $566,000. Parents can also use FVA to plan 529 education savings, where regular monthly contributions can grow substantially over 18 years.

You can also explore our Future Value Factor (FVIF) Calculator for single-sum growth analysis, or the Future Value Calculator for more comprehensive investment projections with both lump sum and periodic deposits.