Annuity Payout Calculator

Given a starting lump-sum balance, an interest rate, and a fixed payout term, this calculator solves for the level periodic payment that exactly depletes the balance to zero by the end of the term — including all the interest the remaining balance earns along the way. It is the reverse of asking 'what is this stream of payments worth today?' — here you already have the balance and want to know how much you can safely withdraw each period.

The Annuity Calculator takes the periodic PAYMENT as the input and solves for the present value or future value of that payment stream. This Annuity Payout Calculator takes the starting BALANCE as the input and solves for the periodic PAYMENT that exactly depletes it over a chosen term. They use the same underlying annuity-factor math but solve in opposite directions — like the relationship between an EMI calculator (solves for the payment on a loan) and a present-value calculator (solves for the loan amount a payment can support).

For an ordinary annuity (payout at the end of each period): PMT = PV × r / [1 − (1 + r)^−n], where PV is the starting balance, r is the interest rate per period (annual rate ÷ payments per year), and n is the total number of payouts (years × payments per year). For an annuity due (payout at the start of each period), divide the ordinary result by (1 + r).

In an annuity due, each payout happens one period earlier, so the remaining balance has one fewer period to earn interest before that payout is taken. To still deplete the exact same balance over the exact same number of payouts, each individual payout must be smaller — specifically, the ordinary-annuity payout divided by (1 + r).

At 0% no interest is credited, so the balance is simply divided evenly across all payouts: payout = principal ÷ number of payouts. The standard formula becomes a 0/0 indeterminate form at r = 0, so a correct calculator evaluates this limit explicitly (payout = PV/n) rather than dividing by zero.

Stretching the same starting balance over more payout periods means each individual payment can be smaller while still fully depleting the balance by the end — and the balance also has more total periods to earn interest, further reducing the required payment per period. This is the same why a 30-year mortgage has lower monthly payments than a 15-year mortgage on the same loan amount.

No — the relationship is not linear. As the term grows very long, the periodic payout approaches (but never drops below) the 'interest-only' floor of principal × rate per period, because the interest earned on the remaining balance increasingly covers most of each payout. Doubling the term does not halve the payment once interest effects dominate.

No. This calculator models an annuity-certain — a fixed-term payout that is mathematically guaranteed to deplete the balance to exactly zero after a set number of periods, based purely on time value of money. A life (life-contingent) annuity from an insurance company instead pays for as long as the annuitant lives, priced using mortality tables, expense loads and profit margins — its payout will differ from this calculator's figure even at the same nominal rate and 'expected' term.

No. All figures are gross nominal amounts before taxes and before any adjustment for inflation. A portion of each payout in many jurisdictions may be taxable, and fixed nominal payouts lose real purchasing power over a long payout term if inflation is meaningful. Consult a tax or financial adviser for after-tax and inflation-adjusted figures.

More frequent payouts (e.g. monthly instead of annually) mean each individual payment is much smaller, but the interest rate per period is also smaller and there are more total payouts, so the total paid out over the term is not the same across frequencies — more frequent payouts generally result in a slightly lower total payout, because the balance has less time between payments to grow before each withdrawal reduces it.

Yes, as an illustrative planning estimate: enter your current retirement balance, an assumed rate of return, and how many years you want the money to last, and the calculator shows the level amount you could withdraw each period so the balance reaches zero exactly at the end of the term. It assumes a constant rate of return throughout retirement, which real markets rarely deliver exactly — many retirees prefer a more conservative or dynamic withdrawal strategy (such as the 4% rule) to guard against sequence-of-returns risk. See the Retirement Planning Calculator for that approach.

An SWP calculator takes a WITHDRAWAL AMOUNT you choose as the input and tells you how long the balance lasts (or how much remains after a chosen term) — you pick the payment and solve for the outcome. This Annuity Payout Calculator takes the TERM you want as the input and solves for the exact payout that empties the balance by the end of that term — you pick the term and solve for the payment. They answer opposite questions with the same balance-depletion math.

An immediate annuity starts paying income within about a year of when you put the money in — you hand over a lump sum and payments begin almost right away. A deferred annuity instead has an accumulation period first, where the money grows before any payout phase begins, often years or decades later. This calculator models the payout phase itself (the phase where a balance is drawn down on a schedule), so it applies to the payout portion of either type once that phase starts.

Insurers typically offer several payout structures: life-only (payments continue for as long as the annuitant lives, stopping at death with nothing to heirs), life with period certain (payments for life, but if the annuitant dies within a guaranteed window — commonly 10, 15 or 20 years — a named beneficiary keeps receiving them until that window ends), and joint and survivor (payments continue as long as either of two named people is alive). This calculator's math is closest to a pure period-certain payout — a fixed number of payments over a fixed term with no life contingency — rather than any of the life-only or joint-and-survivor options, which require mortality-table pricing this tool does not perform.