Financial Maths: Annuities with a Missing Payment: Find the FV Fast

A skipped payment doesn't just take x out of your annuity. It also takes away the interest that payment would have earned. Take a 4-payment annuity where the payment at time 2 is skipped. The future value at time 4 is: FV = x(1+i)³ + x(1+i) + x The missing term, x(1+i)², is lost for good. That's the payment plus the interest it would have earned for two periods. In this video: • How to build an annuity timeline with a missing payment • Accumulating each remaining payment to the valuation date • Why you subtract the accumulated value of the skipped payment, not just x Part of The Arete Project's annuities series. #Annuities #ActuarialScience #TimeValueOfMoney #FinancialMath #TheAreteProject