Annuity Calculator
An annuity in two phases: what a starting amount and regular contributions grow to, then the level payment that value pays out over a fixed term.
Result
Payment received each period: $2,067.29Estimate
Before fees, surrender charges, riders and tax, which real annuity products carry. Not a product quote.
- Value when payments start
- $341,148.85Estimate
- Total contributed
- $170,000.00
- Total received
- $496,150.78Estimate
- Received less contributed
- $326,150.78Estimate
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Results are arithmetic on the returns, rates and horizons you enter, not a forecast and not investment, tax or retirement advice. The site supplies no expected return, inflation rate, contribution limit, tax rate or withdrawal rate. Real returns vary from year to year, and fees, taxes and the order of returns all change the outcome. Check anything that matters with a qualified adviser. Read the full disclaimer
How to use the Annuity Calculator
- Enter any starting amount, what you add each period and for how many years, and the rate it earns meanwhile.
- Enter how many years you want payments for and the rate the money earns while it pays out.
- Read the level payment you would receive, and the value the account reaches before payments start.
Two phases
While you contribute, the balance grows: the starting amount compounds, and each contribution adds to it. When payments start, the balance at that moment is paid out as a level payment that runs it down to zero at the end of the term. The page computes the value at the handover once and uses that same figure for the payout.
The formulas
With per-period rates i while contributing and j while paying out:
value at handover A = start × (1 + i)^n + contribution × ((1 + i)^n − 1) ÷ ipayment P = A × j ÷ (1 − (1 + j)^−m)where n is the number of contribution periods and m the number of payments. The payment formula is the loan payment formula with the roles reversed: here the insurer or the account pays you.
What this page does not include
Fees, surrender charges, riders, tax on the payments, inflation, and the mortality pricing of a life annuity. Annuities are sold products with many terms, and an unqualified projection would mislead; check any real offer’s own figures.
With your numbers
- Accumulation: $50,000.00 plus $500.00 for 240 periods at 5% = $341,148.85
- Payout: $341,148.85 over 240 periods at 4% = $2,067.29 each
Quick reference
Before fees, surrender charges, riders and tax, which real annuity products carry. Not a product quote.
| Example | Payment received each period |
|---|---|
| 50,000 and 500 a month for 20 years | $2,067.29 |
| 500 a month from nothing | $1,245.39 |
| 50,000 with no contributions | $821.90 |
| Immediate: 250,000 paid over 25 years | $1,319.59 |
| Quarterly, paid at the start | $5,847.22 |
| 10,000 a year for 30 years | $50,606.70 |
Common questions about the Annuity Calculator
- What is an annuity?
- In finance, any series of level payments. As a product, a contract, usually with an insurer, that turns savings into regular income. A deferred annuity has an accumulation phase first; an immediate annuity starts paying at once. For an immediate annuity, enter the lump sum as the starting amount and 0 years contributing.
- What about a life annuity?
- A life annuity pays for as long as you live, however long that is. Its payment depends on the insurer's mortality tables and pricing, which this page does not have. Enter the number of years you expect to be paid to see a fixed-term equivalent, and compare it with a real quote.
- Why might a real annuity pay less than this?
- Fees, commissions, surrender charges and optional riders all reduce what an annuity pays, and they vary a great deal between products. This page models none of them, so treat its result as the payment before those costs.
- Start or end of the period?
- Payments at the start of each period earn, and are paid, one period sooner. Contributions at the start grow a little more; payouts at the start are a little smaller, because the first one is paid immediately.