Annuity Payout Calculator
Turn a lump sum into a paycheck. Estimate the level monthly income a period-certain annuity could provide and its effective payout rate.
Compare immediate-annuity quotes
Learn moreTrading a lump sum for income
An annuity converts savings into guaranteed income. A period-certain annuity pays a level amount for a fixed number of years; a lifetime annuity pays as long as you live, with the amount set by your age and current rates. The trade-off is liquidity — the lump sum is gone.
How it’s calculated & sources
We treat the premium like a loan the insurer “repays” to you: monthly income amortizes the principal over the payout period at the assumed rate. The payout rate is annual income ÷ premium.
Benchmark: current immediate-annuity payout rates run roughly 6–7% for many ages and terms (LIMRA, 2025).
Results update as you type and are general estimates, not personalized financial, tax, medical or legal advice. Verify with a professional.
Worked example
$250,000 paid out over 20 years at a 5% assumed rate provides about $1,650/month — roughly a 7.9% annual payout (which includes return of your principal).
Frequently asked questions
Is the payout rate the same as interest earned?
No — the payout includes return of your own principal, so it looks higher than the interest rate. Don’t confuse the two.
Period-certain or lifetime?
Lifetime annuities protect against outliving your money but stop at death (unless you add a guarantee). Period-certain pays a set term to you or your heirs.