Annuity Calculator
See the monthly income a lump sum can generate over a set payout period — plus how much of that is your own money versus interest earned.
How this works
This models a fixed-period (period-certain) annuity: your lump sum earns the rate you set and pays you a level monthly income that exactly depletes the balance over the chosen number of years. It's the same math as a mortgage in reverse — the insurer "lends" your money back to you with interest.
- Immediate vs. deferred — an immediate annuity starts paying now; a deferred one grows first, then pays later.
- Fixed vs. variable — fixed annuities guarantee the rate; variable ones rise and fall with investments.
- Period-certain vs. lifetime — this tool uses a set period; a lifetime annuity pays as long as you live (the insurer takes the longevity risk, usually for a lower monthly amount).
Annuity FAQs
For some retirees, yes — it converts savings into predictable income you can't outlive (with a lifetime option) and removes market worry. The trade-offs are fees, reduced flexibility and giving up access to the lump sum. It's one tool, not a whole plan.
Use a conservative figure close to current fixed-annuity or bond rates. Higher assumed rates inflate the income estimate; real guaranteed rates are usually modest.
It depends on the contract. A period-certain annuity can pay the remainder to beneficiaries; a pure life annuity may stop at death unless you add a guarantee or joint option (which lowers the payout).