Annuity due
Certified Financial Planner glossary · Certified Financial Planner
Definition
A series of level payments occurring at the beginning of each period.
Annuity due in plain English
Apartment rent is due on day one of the month, not on the last day. That beginning-of-period pattern is an annuity due: level payments at the start of each period. Ordinary annuities pay at period end instead. On a financial calculator, BEGIN versus END mode changes present and future value for the same cash-flow amounts. If a CFP stem prepays tuition or lease installments, switch to annuity-due timing before you solve for PV or FV. Mixing BEGIN and END mode is a fast way to miss an easy TVM item.
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