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The payout formula
Monthly payout = balance × r ÷ (1 − (1 + r)−n), where r is the annual rate ÷ 12 and n the number of months. It is the loan payment formula in reverse. Payments made at the start of each month are slightly smaller (÷ (1 + r)).
Monthly payout by amount and years (5%)
| Balance | 10 years | 15 years | 20 years | 25 years | 30 years |
|---|---|---|---|---|---|
| $100,000 | $1,061 | $791 | $660 | $585 | $537 |
| $250,000 | $2,652 | $1,977 | $1,650 | $1,461 | $1,342 |
| $500,000 | $5,303 | $3,954 | $3,300 | $2,923 | $2,684 |
| $750,000 | $7,955 | $5,931 | $4,950 | $4,384 | $4,026 |
| $1,000,000 | $10,607 | $7,908 | $6,600 | $5,846 | $5,368 |
Fixed period vs lifetime annuity
This page models a period-certain payout. A life annuity pays as long as you live, so its rate depends on age, sex, the insurer's pricing and options such as joint life or inflation increases. Get quotes for those; do not apply these numbers to them. Annuity income may be partly taxable, and surrender charges can apply to early withdrawals.
Sources and assumptions
- Ordinary annuity formula with monthly compounding.
- FINRA: annuities
Related
Frequently asked questions
How is an annuity payment calculated?
For a fixed period: balance × r ÷ (1 − (1 + r)^−n), with r the monthly rate and n the number of payments.
Is this a lifetime annuity quote?
No. Lifetime annuity payouts depend on age and insurer pricing; this calculator shows a fixed-period payout.