How to Use a Monthly Annuity Calculator


An annuity can be defined as a series of fixed payments made to a recipient at equal intervals. Some examples of annuities include interest received from fixed deposits in banks, payments made by insurance companies and pension payments. Although the type of annuity is determined by the source and frequency of payment dates, the method of calculation is fairly similar. Fortunately, many annuity calculators are available online to help you calculate your payments.

Go Online

The emergence of technology has put information at your fingertips, allowing you to track and calculate many investments yourself. Type “annuity calculator” into your favorite search engine to find numerous websites with calculators displayed on their pages. Ideally, choose from the first few websites as they tend to be the most vetted for reliability.

Choose the Right Monthly Annuity Calculator

There are many types of annuity calculators, such as pump flow rate calculators, gas flow rate calculators, net and gross pay calculators, lump sum annuity calculators, single annuity calculators and present annuity calculators. Be sure you choose to calculator that fits your needs. For example, the present annuity calculator gives you the present value of a series of cash flows to be paid out in the future. This present value helps you decide the best investment for the highest return on your money.

Understand the Parameters

Once you choose the right annuity calculator, the next step is to understand what values you should input. Regardless of which lump sum annuity calculator you choose, you have to provide the starting principal, duration of payout and the amount that will be paid out to you at each interval.

Figure Out Where to Input

The design of each annuity calculator is different. Some are vertically placed, while others are horizontally inclined. You just need to look at where each value belongs and enter the correct values. Some calculators ask you to enter the annual interest rate, while others calculate the value from the principal and monthly payout values. Always double check to make sure you entered the right values before clicking the “Calculate” button.

View and Interpret the Results

In most cases, the results are displayed on the same page, just below all the parameters. This is the amount you get as an annuity at each interval. Based on this result, you can make appropriate decisions about your current and future finances. In short, using an online single annuity calculator is quick and simple, provided you input accurate values in the right places.