The Perpetuity Calculator is an essential financial tool designed to help professionals calculate and analyze infinite streams of equal payments or cash flows. This sophisticated calculator enables users to determine the present value of perpetual payments or compute annual returns based on initial investments and interest rates. Whether you’re conducting investment analysis, valuing long-term assets, or planning financial strategies, this tool provides accurate calculations for perpetual annuities and continuous cash flows. Financial analysts, investment managers, and business professionals can leverage this calculator to make informed decisions about long-term investments and valuations. The calculator’s intuitive interface and precise calculations make it an invaluable resource for anyone working with perpetual payment scenarios. Start using our Perpetuity Calculator today to streamline your financial planning and investment analysis processes.
A perpetuity pays a fixed amount forever: simply multiply the investment’s present value by its annual interest rate. For instance, $100,000 at 6 % yields $6,000 every year. UK Consol bonds, one of the oldest perpetuities, traded near a 2.5 % yield in 2015 (Bank of England, 2016).
Perpetuity yield equals the annual payment divided by current price, expressed as a percentage. U.S. preferred shares averaged a 6 % yield in 2023 (S&P Global, 2023). Enter any positive payment and present value, press “Calculate,” and the tool shows the exact return instantly.
Use the calculator by entering any present value (PV) and annual interest rate (r); the payment appears instantly. The formula is simple: PV × r. For example, a $100,000 perpetuity at 5 % pays $5,000 each year (Berk & DeMarzo, 2020). Accurate inputs give you precise, perpetual cash-flow figures.
