Annuity Payout Calculator

How it works

Calculate the monthly income you can receive from a fixed annuity.

Determine your monthly retirement income

Description

The Annuity Payout Calculator is the counterpart to the accumulation tool. It helps you determine how much regular monthly income you can receive from a lump-sum annuity investment over a specific number of years. It treats the annuity as a self-liquidating fund that pays out both principal and interest until exhausted.

Inputs

• Investment Amount: The total lump sum you have available to start the annuity payout ($).
• Interest Rate: The annual interest rate the remaining balance earns during the payout phase (%).
• Payout Duration: The number of years you want the monthly payments to last.

Outputs

• Monthly Income: The fixed amount you will receive each month.
• Total Payout: The total sum of all monthly checks you will receive over the entire duration.
• Total Interest: The extra money earned over the payout period that was added to your monthly checks.

Chart

• N/A: This tool provides a direct breakdown of your monthly and total distribution.

“Good to Know”

• This type of annuity is often called an “Annuity Certain” or a “Fixed Period Annuity.”
• If you choose a longer duration, your monthly payments will be smaller, but the total interest earned will be higher.
• Unlike a “Life Annuity,” this model strictly pays out over the defined number of years and does not continue after the term expires.

Examples

Example 1: Standard Retirement Drawdown

• Input:
  • Investment: $250,000
  • Rate: 5%
  • Duration: 20 Years
• Output:
  • Monthly Income: ~$1,650
  • Total Payout: ~$396,000

Example 2: Conservative 30-Year Plan

• Input:
  • Investment: $500,000
  • Rate: 4%
  • Duration: 30 Years
• Output:
  • Monthly Income: ~$2,387
  • Total Payout: ~$859,000

Example 3: Short-TermBridge

• Input:
  • Investment: $100,000
  • Rate: 6%
  • Duration: 10 Years
• Output:
  • Monthly Income: ~$1,110
  • Total Payout: ~$133,000