Annuity Due

Accounting Dictionary

Annuity Due

When a person receives money at the beginning of every year for a certain number of years instead of receiving the money all at once in one lump sum, we call the payments an annuity due.

John had a choice of receiving $10,000 now or $2,100 at the beginning of the year for five years. If he chose the yearly payments, we would say he has an annuity due. If the payments came at the end of the year we would say he has an annuity.

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