DEFINITION of 'Annuity In Advance'
An amount of money that is regularly paid at the beginning of a term. Rent is the classic example of an annuity in advance because it is a sum of money paid at the beginning of the month to cover the 30 days to follow. An annuity in advance is also called an "annuity due."
The opposite of an annuity in advance is an annuity in arrears (also called an "ordinary annuity"). Mortgage payments are an example of an annuity in arrears. Like rent payments, mortgage payments are due on the first of the month; however, the mortgage payment covers the previous month's interest and principal on the mortgage loan.
BREAKING DOWN 'Annuity In Advance'
One instance where the difference between an annuity in advance and an annuity in arrears matters is in the valuation of income properties. If payments are received at the beginning of the rental period rather than at the end of the rental period, their present value increases.
Don't be confused by the name: an "annuity in advance" is not the type of investment product that we usually think of when we hear the word "annuity" in finance.

Annuity In Arrears
An annuity that has periodic payments of either interest and/or ... 
Valuation Period
The time between the end of the business day of the first business ... 
Delayed Annuity
An annuity in which the first payment is paid at a later date ... 
Ordinary Annuity
A series of equal payments made at the end of each period over ... 
Annuity
A financial product that pays out a fixed stream of payments ... 
Deferred Annuity
A type of annuity contract that delays payments of income, installments ...

Retirement
Are Annuities RetirementOnly Investments?
Learn more about why annuities are generally purchased and the way that they can positively and negatively affect an individual preparing for retirement. 
Investing Basics
DIY Annuities: What You Need to Know
Annuities are attractive because they can give you a stream of income, but they can be tricky to buy. 
Options & Futures
20 Investments: Annuity
What Is It? You can think of an annuity as another way of saying "annual payments". An annuity is a series of fixedamount payments paid at regular intervals over the specified period of the ... 
Options & Futures
Add Annuities To Your Retirement Portfolio
The only real difference between you and Warren Buffett is a few wellchosen stocks â€“ the billiondollar fortune is the result. 
Retirement
How a Fixed Annuity Works After Retirement
These popular investments can provide a steady stream of income during your retirement years. Here are the details. 
Investing Basics
5 Mistakes to Avoid When Shopping for Annuities
Annuities give retirees guaranteed income but they aren't all created equal. 
Retirement
Who Benefits From Retirement Annuities
Annuities guarantee some degree of fixed income in retirement. But is the security worth the fees and less favorable tax treatment? How to decide. 
Investing Basics
Are Annuities Right for You?
Annuities are safe and often appealing, but IRAs and 401(k)s offer advantages that annuities typically canâ€™t match, with little additional risk. 
Retirement
Retirement Tips: Choose the Best Annuity Provider
It pays to get the best advice if you are thinking of putting your money into one of these complicated investments. 
Investing
Advising FAs: Explaining Annuities to a Client
Conceptually speaking, annuities can be thought of as a reverse form of life insurance.

For what types of financial instruments would I want to calculate the present value ...
Learn about the types of financial instruments the present value of an annuity calculation is most useful for, including ... Read Answer >> 
What are the risks of annuities in a recession?
Distinguish between the most common types of annuities, and understand which types of annuities pose the most risk during ... Read Answer >> 
What are the main kinds of annuities?
Learn about the four basic types of annuities, and why the different investment and payout options are suitable for different ... Read Answer >> 
Should I pull my money out of an annuity if the insurance company is having financial ...
If an insurance company is having financial problems, you don't necessarily have to pull your money out of the annuity. Even ... Read Answer >> 
What are the best ways to sell an annuity?
Learn about the best ways to sell annuities. Annuities are financial products that provide income on a regular basis to their ... Read Answer >> 
How do I calculate the future value of an annuity?
Find out how to calculate the future value of an ordinary annuity or an annuity due, including how the power of compounding ... Read Answer >>