Present Value Interest Factor Table (PVIFA)
The factor used to calculate present value of series of annuity payments known as Present Value Interest Factor of annuity (PVIFA).
Along with this, it is a number through which the present value of a series of payment is represented.
With the help of it, the initial payment becomes able to earn interest at the periodic rate (r) over a number of payment periods (n).
Use of PVIFA
It is used to calculate the present value of an annuity. To find it, you should have PVIFA factor value first. Then, multiply it by the periodic payment amount to find the current present value of the annuity.
What is the Present Value Annuity Factor Formula?
To calculate PVIFA, the formula is:-
(1 – (1 + r)^-n) / r
Where
- r = Periodic rate per period
- n = Number of periods
Present Value Annuity Factor Table
Here’s an example of what a present value interest factor of annuity table looks like:
| Period | 1% | 2% | 3% | 4% | 5% |
| 1 | 0.9901 | 0.9804 | 0.9709 | 0.9615 | 0.9524 |
| 2 | 1.9704 | 1.9416 | 1.9135 | 1.8861 | 1.8594 |
| 3 | 2.9410 | 2.8839 | 2.8286 | 2.7751 | 2.7232 |
| 4 | 3.9020 | 3.8077 | 3.7171 | 3.6299 | 3.5460 |
| 5 | 4.8534 | 4.7135 | 4.5797 | 4.4518 | 4.3295 |
To download Present Value Interest Factor Table (PVIFA) PDF, you can go through the link provided below.