Annuity Calculator

Turn a lump sum into a fixed payment over a set number of years. An estimate, not an insurer quote.

Smart Tips

• End of period is the ordinary annuity. Beginning of period pays a little less because each payment is one period earlier.

• A zero rate splits the lump sum into equal payments. $1,200 over 12 months is $100.

• The series stops after the last period. It does not continue for life.

• Interest above the lump sum is total payments minus the starting amount. It is not a quoted yield from an insurance company.

The Formula

Payment = Lump sum × r ÷ (1 − (1 + r) ^ −n)

r Rate per period
Annual rate ÷ payments per year

n Number of payments
Years × payments per year

Due Beginning of period
Divide the ordinary payment by 1 + r

Zero rate Equal split
Lump sum ÷ n

Investor.gov defines compound interest as interest paid on principal and on accumulated interest. It does not print this payout formula. The formula on this page is a fixed number of payments with no survival probability. A beginning-of-period payment is the end-of-period payment divided by 1 plus the period rate.

Key Insights

Fixed term

You choose the years. The payment does not depend on age or a life table.

No premium load

The whole lump sum is converted. A sales charge would have to be removed before you enter it.

Earlier payments are smaller

Annuity due divides by 1 plus the period rate because the series starts immediately.

Zero rate is a split

With no interest, every payment is the lump sum divided by the number of payments.

Frequently Asked Questions

No. An insurer prices a lifetime annuity with mortality, expenses, and the rate it chooses. This page only converts a lump sum into equal payments for a number of periods you set.

End of period is an ordinary annuity: the first payment arrives after one period. Beginning of period is an annuity due: the first payment arrives now, so each payment is smaller by the factor 1 plus the period rate.

The lump sum is divided by the number of payments. $1,200 paid monthly for one year is $100. $10,000 paid once a year for 10 years is $1,000.

No. The rate and the payment stay flat for the whole term. Inflation and a cost-of-living rider are not applied.

Add every payment and subtract the lump sum. That gap is the interest in the series. It is arithmetic, not a declared insurer yield. This is an estimate, not annuity advice.

Investor.gov's compound-interest glossary says compound interest is interest paid on principal and on accumulated interest. It does not publish this period-certain payment. The payout formula is stated on this page. No insurer rate and no mortality table are used.

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Payment

Enter values to calculate

Total paid

Interest above the lump sum

Note:This is an estimate of a period-certain payout, not an insurer quote and not annuity advice. A commercial annuity can add fees, a death benefit, or a lifetime guarantee. None of those are in this payment.