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annuityguide

Annuity calculator

Estimate the monthly income a lump sum could produce — either as payments for life, or over a fixed number of years — and see how deferring the start date changes the answer. No email, no quote form, and every assumption is written out below.

Last updated September 19, 2026 · Estimates only, not a quote · methodology

Your details
Single premium, in dollars
Same as your age now means income starts immediately
Applies only during the years you wait
Payout type
Used only for the purchasing-power figure

Estimated monthly income

$787

starting at age 65, continuing for life

Deposit
$100,000
Value after 5 years of growth
$127,628
Annual income
$9,444
Total received if you live to 90
$236,112
Buying power of that payment in 10 years
$586

Estimate only. Real quotes vary by insurer, state, gender, payout option and the rate environment on the day you buy.

Assumptions behind the numbers

  • Lifetime payouts use mid-range single-life immediate annuity payout rates observed in recent US quotes — about 6.6% of premium a year at age 60, 7.4% at 65, 8.3% at 70, 10.1% at 75 and 12.3% at 80 — interpolated for ages in between. These are level payments with no death benefit.
  • Joint life applies a 14% reduction, the middle of the usual 10%–20% range for a full survivor benefit.
  • Fixed-term payouts use the standard ordinary annuity formula with monthly compounding: payment = PV × i ÷ (1 − (1 + i)^−n).
  • Deferral compounds the deposit annually at the rate you enter, then applies the payout rate for your start age. A real deferred income annuity is priced differently and often pays more than this method suggests.
  • Taxes and fees are excluded. Part of each non-qualified payment is typically a tax-free return of premium; income from an IRA is generally fully taxable.
  • The "total received" line for lifetime income assumes payments to age 90 purely for illustration. Real lifetime income continues however long you live, which is the point of the product.

How to use the result

  1. Compare the lifetime figure against the fixed-term figure. If the term option pays more per month, remember it stops — you are trading longevity protection for a higher payment.
  2. Take the monthly figure to two or three insurers as a sense-check. Quotes for identical terms commonly differ by 5%–10%, which is 5%–10% more income for life.
  3. Look at the purchasing-power line. If a level payment worries you, price an increasing-payment option or annuitise only part of your savings.
  4. Before buying commercial income, check the value of delaying Social Security — usually the cheapest inflation-adjusted lifetime income available.

Frequently asked questions

How do you calculate an annuity payout?
For a fixed term, the monthly payment is the present value multiplied by the monthly interest rate, divided by one minus (one plus the monthly rate) raised to the negative number of payments. For a lifetime payout, insurers instead use age, gender, current bond yields and mortality tables, which is why life quotes must come from an insurer.
How much does a $500,000 annuity pay per month?
As an immediate lifetime annuity for a 65-year-old, recent US quotes have been roughly $2,900–$3,250 a month for a single life with no refund feature. A fixed 20-year term payout at a 5% rate would be about $3,300 a month, but it stops after 20 years whereas the lifetime option does not.
Is this calculator a quote?
No. It is an estimate based on published payout-rate ranges and standard time-value arithmetic. Actual quotes depend on the insurer, your state, your age at the start date, the payout option and the rate environment on the day you buy.
Does the calculator account for inflation?
The payout figures are level, meaning the same dollar amount every month. You can see the effect of inflation in the purchasing-power line, which discounts the payment at the inflation rate you enter.

Sources

  • Published multi-insurer SPIA quote ranges, checked at the date shown above.
  • Internal Revenue Service — Publication 575 (taxation of annuity payments).
  • Social Security Administration — delayed retirement credits.
  • Standard actuarial present-value formula for a level ordinary annuity.