Annuity Payout Calculator
Turn a lump sum into a level monthly income for a set period.
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Annuity Payout Calculator by TheCalcTools
How the Annuity Payout Calculator works
Enter the lump sum, an assumed interest rate and the number of years you want payments to last.
The payment is the level amount that uses up the balance exactly at the end.
This is the same formula used for loan payments.
The formula
Worked example
Using the default values shown in the calculator:
| Lump sum | $300000 |
|---|---|
| Annual interest rate (%) | 4 % |
| Payout period (years) | 25 |
- Monthly rate = 4% ÷ 12; 300 payments.
- Monthly payout = $1,583.51.
- Total paid out is $475,053, including $175,053 of interest.
Result:
| Monthly payout | $1,583.51 |
|---|---|
| Total paid out | $475,053 |
| Interest earned along the way | $175,053 |
Frequently asked questions
Is this the same as a commercial annuity?
No. Insurers’ annuities depend on their pricing, life expectancy and fees, and may pay for life. This is a fixed-period illustration.
What if inflation rises?
The payment is fixed in dollars, so its buying power falls over time.
Sources and further reading
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This calculator gives estimates for information only. It is not financial advice, and your lender's or provider's figures will govern. Rates, fees and rules vary. See our disclaimer.