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Perpetuity Value Calculator

Work out perpetuity value instantly with clear inputs, formula shown and shareable results.

About Perpetuity Value Calculator

A perpetuity pays a fixed amount for ever, and its value is simply the payment divided by the discount rate. The factor 1/r is also the ceiling on any long annuity factor at that rate.

Formula

Perpetuity

PV = P / r

P
Annual payment
r
Discount rate

Worked example

With the default values below, Perpetuity Value Calculator returns Present Value Of The Perpetuity of $1,250,000.00. Change any input above and every figure here is recalculated in your browser.

Inputs used

Payment Per Yearminimum 0
100,000
Discount Rateaccepts 0–100 %
8 %

Results

Present Value Of The Perpetuity
$1,250,000.00
Perpetuity Factor (1/r)
12.5000
Yield On Value
8.000%
Value Of 100 A Year For Ever
$1,250.00

Step by step

  1. 1Values used
  2. 2Perpetuity
  3. 3Present Value Of The Perpetuity= 1,250,000.00
  4. 4Perpetuity Factor (1/r)= 12.5000
  5. 5Yield On Value= 8.000
  6. 6Value Of 100 A Year For Ever= 1,250.00

Assumptions and limits

  • The result is derived only from the 2 inputs listed above. Anything not among them is not part of the calculation.
  • In particular, this calculator does not take inflation, tax or fees or charges into account.
  • Figures are rounded for display to 4 decimal places, so totals built from several rounded parts can differ slightly from the unrounded arithmetic.
  • Figures are estimates for planning only. Market returns are not guaranteed, and rates, limits and tax rules change. This is not financial or tax advice — speak to a qualified adviser before acting.
  • This is an estimate for general information and not professional financial, tax or legal advice. See the full disclaimer for the limits that apply to this kind of calculator.

How these calculators are built and tested is described on the Methodology page. If a figure looks wrong, please report it.

Figures are estimates for planning only. Market returns are not guaranteed, and rates, limits and tax rules change. This is not financial or tax advice — speak to a qualified adviser before acting.

Frequently Asked Questions

Do real perpetuities exist?

Consols and some preference shares come close, and ground rents behave similarly.

Why is a long annuity almost a perpetuity?

Because distant payments discount to almost nothing — at 8% the difference between 50 years and for ever is small.

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