Finance & Money · 年金 · Updated 2026-10-25
What Is Annuity?
Definition
An annuity is a stream of equal payments at fixed intervals — the math behind pensions, mortgages and leases. PV = A×[1−(1+r)^−n]/r; FV = A×[(1+r)^n−1]/r.
Formula
PV = A × [1 − (1+r)^−n]/r; FV = A × [(1+r)^n − 1]/r
Worked Example
Investing 2,000/month at 5% for 30 years yields ~1.66M from only 720k of contributions.
Common Misconception
"Annuity insurance yields are high" - the advertised "receive X at maturity" must be converted via IRR; most savings-type products run a long-term IRR of just 1.5%-3%, sometimes below long-term government bonds.
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