Present Value of Growing Annuity Calculators – Ordinary Growing Annuity and Growing Annuity Due

The present value of a growing annuity represents the current value of a future series of payments for a specified time, where the payments are growing at a steady (compound) rate (i.e. 3% per year). It is based on the ‘time value of money’ concept, which breaks down to the idea that a dollar today is worth more than a dollar tomorrow (as a dollar today can be invested to earn interest until tomorrow). The most common example of a growing annuity is perhaps a dividend stock, where dividends are steadily increasing (i.e. going up by 3% per year). In an ordinary growing annuity, payments are made at the end of the period. Conversely, where payments are made at the start of the period (i.e. a lease with annual payments at the start of the period), the use of the growing annuity due formula is appropriate (which differs from the ordinary growing annuity formula by a factor of 1 + interest rate). Using the calculators below, you can solve for any of the variables in either formula, and see how the present value declines over time, in the table and chart at the bottom of the page.

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Ex. Unknown Present Value (PV)

To find the unknown present value (PV) of a Growing Ordinary Annuity (or a Growing Annuity Due), where the periodic payment (PP) is \$100.00, the interest rate (i) is 7%, the growth rate (g) is 3% and the number of periods (n) is 5, enter:

 PP = 100 i = 0.07 g = 0.03 n = 5

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Ex. Unknown Periodic Payment (PP)

To find the unknown periodic payment (PP) of a Growing Ordinary Annuity (or a Growing Annuity Due), where the present value (PV) is \$500.00, the interest rate (i) is 7%, the growth rate (g) is 3% and the number of periods (n) is 5, enter:

 PV = 500 i = 0.07 g = 0.03 n = 5

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Ex. Unknown Interest Rate (i)

To find the unknown interest rate (i) of a Growing Ordinary Annuity (or a Growing Annuity Due), where the present value (PV) is \$500.00, the periodic payment (PP) is \$100.00, the growth rate (g) is 3% and the time (n) is 5, enter:

 PV = 500 PP = 100 g = 0.03 n = 5

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Ex. Unknown Growth Rate (g)

To find the unknown growth rate (g) for a Growing Ordinary Annuity (or a Growing Annuity Due) where the present value (PV) is \$500.00, the periodic payment (PP) is \$100.00, the interest rate (i) is 7% and the time (n) is 5, enter:

 PV = 500 PP = 100 i = 0.07 n = 5

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Ex. Unknown Number of Periods (n)

To find the unknown number of periods (n) for a Growing Ordinary Annuity (or a Growing Annuity Due), where the present value (PV) is \$500.00, the periodic payment (PP) is \$100.00, the interest rate (i) is 7% and the growth rate (g) is 3% enter:

 PV = 500 PP = 100 i = 0.07 g = 0.03