I am trying to figure out what the formula is to determining how much of a payment my parents should get.

Now I already know what the company told them they should get but I want to see how that number was reached. I’ve found some websites where you can plug in the numbers but I want to see what the actual formula is.

For instance my parents have a 9800 current value annuity. they want to start payments on it and in 20 years it zero’s out. The current fixed interest rate is 4%. I believe the company came up with something like 721 a year.

I just want to figure out how they got that number. Does anyone know what the formula is?


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