How this calculator works
PVIFA sums the discounted value of one unit paid at every period end. Multiply by the payment to value an ordinary annuity. For payments at the beginning, each payment is discounted for one fewer period. At zero interest, the factor is simply the number of payments. The rate must match the payment interval.
Formula
PVIFA = [1 - (1 + i)^(-n)]/i; at i = 0, PVIFA = n. Annuity-due factor = PVIFA x (1 + i). PV = payment x factor.
Worked example
Two $100 payments at 10% have an ordinary-annuity factor of 1.73553719 and present value $173.55. At 0%, ten $100 payments are worth $1,000.
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Frequently asked questions
What does the factor measure?
It is the present value of a payment of one currency unit in each payment period.
Can the factor exceed the payment count?
Yes, a negative discount rate makes future payments more valuable today.
Does this accept changing payments?
No. Use discounted cash flow for unequal payments.