Annuity Calculator
Calculate annuity accumulation or payout amounts. Model growth during the accumulation phase or estimate income from an annuity.
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Understanding Annuities
An annuity converts a lump sum into guaranteed periodic payments. Immediate annuities start paying right away — ideal for retirees wanting guaranteed income. Deferred annuities grow tax-deferred until you start withdrawals. On $500,000 at 5% over 20 years, you'd receive about $3,300/month — totaling $792,000. The extra $292,000 comes from interest earned on the declining balance. Compare this with simply withdrawing from investments using our Retirement Longevity Calculator.
Frequently Asked Questions
How much does a $500,000 annuity pay?
At 5% interest over 20 years, approximately $3,300/month. Over 25 years, about $2,900/month. The longer the period, the lower the monthly payment but more total interest earned.
Are annuities a good investment?
Annuities provide guaranteed income — valuable for baseline retirement expenses. But fees can be high (1-3%/year). Compare the annuity rate to what you could earn investing the same amount.