Finance

Annuity Payment Calculator

Estimate the regular payment from a lump sum invested as an annuity.

The payment per period is the regular amount received in each payment period, and the total received is the sum of all payments over the full term, so together they show the steady income from the lump sum and what it adds up to over time.

Formula

Payment equals lump sum times the periodic rate, divided by one minus one plus the periodic rate to the power of negative periods.

How it works

This models a fixed annuity that pays out until the lump sum is exhausted. Real annuities may be for life, inflation-linked, or include fees, which change the payment.

Worked example

For example, a lump sum of $200,000 at an annual interest rate of 5 percent over 20 years with 12 payments per year gives a payment per period of $1,319.91 and a total received of $316,778.75.

FAQs

Is the payment guaranteed?
Only as the annuity contract states — check the provider's terms.

What if I live longer than the term?
A fixed-term annuity stops; a lifetime annuity does not.

Are taxes included?
No, annuity income is often taxable — check local rules.

Are these figures financial advice?
No — they are estimates for planning only, not financial advice. Check with a qualified adviser for decisions involving large sums.

Estimates only, not financial advice. Figures are approximate and do not include all fees, taxes, or changing rates unless stated.

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