The Regular Payment of an Annuity

So far, our calculations have been determining these large “Amounts” or “Present Values” with annuities. While that is a great place to start, and it is important for you to keep track of these total, a more “day to day” calculation involves determining the payment (R)

Ford F-150F-150

Any time you get a loan, you use the present value formula to determine the payments. PV = i = 3% (C:M) n = 5y X 12 = 60

70 = R[ 1 – (1.0025) -60 ] 70 = R[ ] = R How much interest? X 60 = $ – = $

You want to retire a millionaire! A = i = 4% N = 45 years R = ? Use the amount formula

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