Annuity PaymentsPayments in Time Value of Money formulas are a series of equal, evenlyspaced cash flows of an annuity such as payments for a mortgage or monthly receipts from a retirement account. Payments must:
Calculate Payments When Present Value Is KnownThe Present Value is an amount that you have now, such as the price of property
that you have just purchased or the value of equipment that you have leased. When
you know the present value, interest rate, and
number of periods of an ordinary annuity, you
can solve for the payment with this formula:
Where: Example: You can get a $150,000 home mortgage at 7% annual interest rate for 30 years. Payments are due at the end of each month and interest is compounded monthly. How much will your payments be? PVoa = 150,000, the loan amount payment = 150,000 / [(1  ( 1 / (1.005833)^{360})) / .005833] = 997.95
Calculate Payments When Future Value Is KnownThe Future Value is an amount that you wish to have after a number of periods have
passed. For example, you may need to accumulate $20,000 in ten years to pay for
college tuition. When you know the future value, interest rate, and number of periods of an ordinary annuity, you can solve for the payment with this formula:
Where: Example: In 10 years, you will need $50,000 to pay for college tuition. Your savings account pays 5% interest compounded monthly. How much should you save each month to reach your goal? FVoa = 50,000, the future savings goal payment = 50,000 / [(1.004167^{120}  1) / .004167] = 321.99 

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