Annuity Calculator
Adjust parameters to see results
Total Payout
Total Interest
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This calculator is for educational and estimation purposes only. Results are not quotes and do not represent actual annuity offers from any insurer or provider. Always consult a qualified financial professional for personalized advice.
Free annuity calculator. Calculate periodic payments from a lump sum or the principal needed for target income. Fixed, lifetime and joint annuities with COLA. 100% private.
How to Use the Annuity Calculator
Enter the parameters
Enter the investment amount (or your target payment), the annual interest rate, the payment frequency, and either a term in years or your age at payout.
Choose the direction
Calculate Payment turns a lump sum into a periodic payout; Calculate Principal works backwards from a target income to the capital it needs.
Pick the payout type
Period certain, life only, life with a guarantee period, or joint & survivor. For the lifetime options, age and gender select the mortality rates.
Read the results
Payment, total payout, interest, break-even and life expectancy update as you type. Open the amortization schedule for the year-by-year breakdown.
How It Works
Fixed Period Formula
For period certain annuities, the payment is calculated using the standard time value of money formula: PMT = PV × r / (1 - (1+r)^(-n)). You know exactly how much you'll receive and for how long.
Lifetime Calculation
For lifetime annuities, the calculation uses actuarial principles with mortality tables (SSA 2023 Period Life Table). Your age and gender determine life expectancy, which affects how much you can receive each period.
COLA Adjustment
With COLA (Cost of Living Adjustment), your payment increases by a fixed percentage each year to help maintain purchasing power. The initial payment is lower to accommodate the growth, but total lifetime payments are higher.
Joint & Survivor Annuities
Joint & Survivor annuities continue payments to a surviving spouse after the primary annuitant passes. The survivor benefit percentage (50%, 75%, or 100%) determines how much the survivor receives. This option provides lifetime income protection for couples.
References & Methodology
• SSA 2023 Period Life Table — Official U.S. mortality data used for life expectancy and lifetime annuity calculations.
• IRS Section 7520 Rates — Federal mid-term rates used for private annuity and charitable trust valuations.
• SOA RPEC 2020 Mortality Tables — Society of Actuaries industry-standard mortality tables for annuity pricing.
FAQ
What is the difference between Period Certain and Life Only?
Period Certain guarantees payments for a fixed number of years regardless of lifespan. Life Only pays as long as you live — if you pass away early, payments stop. Life with Guarantee combines both: you get lifetime payments with a minimum guarantee period.
How accurate is the mortality table used?
This calculator uses the SSA 2023 Period Life Table for mortality probabilities, the same type of data used by insurance companies. However, actual annuity pricing from providers includes additional factors like expenses, profit margins, and current market conditions not reflected here.
What does COLA mean?
COLA (Cost of Living Adjustment) means your payment increases by a fixed percentage each year. For example, with 3% COLA, if your first year payment is $1,000/month, the second year would be $1,030/month, then $1,061/month, etc. This helps protect against inflation.
Why is my monthly payment lower than annual?
Monthly payments are calculated by dividing the annual rate by 12 and compounding over 12 times as many periods. Due to the time value of money and compounding effects, the monthly equivalent of an annual payment is slightly less than 1/12 of the annual amount.
Is this a quote from an insurance company?
No. This calculator is for educational and estimation purposes only. Actual annuity quotes from insurers depend on current interest rates, company-specific mortality assumptions, administrative fees, and profit margins. Always consult a financial professional for actual quotes.