Which is better: Cash up front or payments over time?

Compare the value of taking a cash lump sum today against receiving a series of payments over time.

Cash Up Front Information

Cash up front amount ?

The one-time payment you could take instead of receiving installments.

Potential return on investment ?

The annual rate you expect to earn if you invest the lump sum yourself.

Table of Historic Rates of Return. Inflation 2.9%, U.S. Treasury Bills 3.3%, Long-term Government Bonds 5.0%, U.S. Large-Company Stocks 10.4%, and U.S. Small-Company Stocks 11.8%. Past performance is no guarantee of future results. Source: Ibbotson SBBI 1926-2024

Payment Information

Annual payment amount ?

The yearly amount you would receive under the payment plan.

Number of payments ?

How many payments you will receive under the installment option.

Advanced options 2

Compounding frequency ?

Monthly Annual

How often the payment stream compounds - monthly or annual.

Annual increase in payments ?

The percentage the payment amount grows each year, if any.

Enter your values and select Calculate.

Use this calculator to help determine whether you are better off receiving a lump sum payment and investing it yourself or receiving equal payments over time from a third party.

This information may help you analyze your financial needs. It is based on information and assumptions provided by you regarding your goals, expectations and financial situation. The calculations do not infer that the company assumes any fiduciary duties. The calculations provided should not be construed as financial, legal or tax advice. In addition, such information should not be relied upon as the only source of information. This information is supplied from sources we believe to be reliable but we cannot guarantee its accuracy. Hypothetical illustrations may provide historical or current performance information. Past performance does not guarantee nor indicate future results.