The pvifa calculator takes interest rate per period (r), number of periods (n) and one payment and returns present value of annuity and pvifa. It is built for quick answers, for checking somebody else’s arithmetic, and for the moments when a formula book is not within reach.
What Is the PVIFA Calculator?
The pvifa calculator takes interest rate per period (r), number of periods (n) and one payment and turns them into present value of annuity and pvifa.
It is the kind of calculation you would otherwise do on the back of an envelope: mechanical, repeatable and easy to get subtly wrong without noticing.
How the PVIFA Figure Is Built
Each result is calculated from the ones before it, so the working is fully visible. That matters when the answer is going to be quoted to somebody else and you need to be able to explain where it came from.
The figures are exactly as good as the assumptions underneath them. Check the rates, the periods and the tax treatment before you rely on the result.
Reading the Result Sensibly
A small change in an input can move the result by much more than you would expect, particularly where the calculation divides by one of the figures you supplied. That is worth understanding before you rely on a figure.
For anything that will be committed to, write the inputs down beside the result. A number you can reproduce is worth far more than one you cannot explain.
A Worked Example
Working through an example, with interest rate per period (r) set to 10, number of periods (n) set to 5, one payment set to 2, the calculator returns pvifa of 0.1, and present value of annuity of 0.2. Substitute your own figures and the same steps produce the same kind of answer.
Frequently Asked Questions
What do I need to work out present value of annuity?
Enter interest rate per period (r), number of periods (n) and one payment. The calculator then works through the relationship and reports present value of annuity and pvifa.
What does the pvifa actually calculate?
It takes interest rate per period (r), number of periods (n) and one payment and converts them into present value of annuity and pvifa using the standard relationship for this problem. Each step is applied in turn, so every output is traceable back to the numbers you typed in.
How should I enter interest rate per period (r)?
Use the value you actually have, in the unit shown next to the field. Enter every value in the same unit system. The calculator assumes the figures you supply are consistent, so it cannot correct a mistake that happens before the calculation starts.
Why does a small change in one value move the answer so much?
That happens when an output depends on a ratio, because dividing by a small number magnifies any change in it. Check the units first, then check whether the value you entered is in the range the relationship was designed for.
Does anything you type get stored?
No. The whole calculation runs inside your browser, and nothing you enter is uploaded, logged or sent anywhere.