Annuity Payout Calculator
Estimate your regular income from annuities and plan your retirement cash flow with our easy-to-use calculator.
Calculate Your Annuity Payouts
Your Annuity Payout Results
Regular Payout Amount
$0
Total Payouts
$0
Total Interest Earned
$0
Effective Annual Yield
0%
Note: These calculations are estimates based on your inputs. Actual annuity payouts may vary based on specific annuity products, fees, market conditions, and other factors.
About Annuity Payouts
An annuity is a financial product that provides regular payments over a specified period. It's often used as a retirement income strategy, helping you convert your savings into a steady income stream.
- Regular Income: Provides predictable payments, helping maintain your standard of living during retirement
- Tax Benefits: In certain cases, annuity growth is tax-deferred until withdrawals begin
- Lifetime Option: Some annuities can provide income for your entire lifetime, eliminating the risk of outliving your savings
Enter your details in the calculator to see how an annuity could work for your retirement plan.
Understanding Annuities
Types of Annuities
There are several types of annuities, each with different features and benefits:
- Fixed Annuity: Provides guaranteed payments for the term of the contract
- Variable Annuity: Payments can vary based on the performance of underlying investments
- Indexed Annuity: Payments are tied to the performance of a market index like the S&P 500
- Immediate Annuity: Starts paying out soon after purchase
- Deferred Annuity: Allows your investment to grow before payments begin
Factors That Affect Annuity Payouts
- Initial Investment: The amount you initially invest in the annuity
- Interest Rate: The annual rate at which your money grows
- Payout Period: How long the payments will continue
- Payout Frequency: How often you receive payments (monthly, quarterly, etc.)
- Annuity Type: Whether payments are made at the beginning or end of each period
- Fees and Expenses: Administrative costs and commissions
- Rider Options: Additional features that may affect payout amounts
Annuity Payout Formulas
Our calculator uses these standard financial formulas to determine annuity payouts:
Ordinary Annuity (End of Period)
For payments made at the end of each period:
PMT = PV × [r / (1 - (1 + r)-n)]
Annuity Due (Beginning of Period)
For payments made at the beginning of each period:
PMT = PV × [r / (1 - (1 + r)-n)] × (1 / (1 + r))
Where:
- PMT = Regular payment amount
- PV = Present value (initial investment)
- r = Interest rate per period
- n = Total number of periods
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Frequently Asked Questions
What is an annuity payout?
An annuity payout is a regular payment distributed from an annuity contract. These payments can be set up to occur monthly, quarterly, semi-annually, or annually, and can last for a specific period or for the rest of your life, depending on the type of annuity you choose.
What's the difference between an ordinary annuity and an annuity due?
The main difference is when payments occur. In an ordinary annuity, payments are made at the end of each period. In an annuity due, payments are made at the beginning of each period. Annuity due payments are typically slightly higher because they're made earlier, allowing the annuity provider to earn interest on the money for a shorter period.
Can I change my annuity payout options after I've started receiving payments?
It depends on your specific annuity contract. Many annuities have limited flexibility once payouts begin. Some may offer options to change frequency or even cash out, but these often come with substantial fees or penalties. It's important to carefully review your options before starting payouts.
Are annuity payouts taxable?
The taxation of annuity payouts depends on how the annuity was funded and what type of annuity it is. Generally, a portion of each payment is considered a return of your principal (non-taxable) and a portion is considered earnings (taxable). For annuities in qualified retirement plans, the entire payment may be taxable. Consult with a tax professional for advice specific to your situation.
What happens to my annuity if I die before receiving all payments?
This depends on the terms of your annuity contract. If you have a life-only annuity with no guarantee period, payments typically stop at death. However, many annuities offer options like "period certain" or "joint and survivor" that ensure payments continue to a beneficiary for a specified time or for the lifetime of a spouse.