KalkWise
Retirement

Annuity Calculator

Calculate how a fixed or variable annuity grows and what monthly income it will pay in retirement.

Updated June 2026 · Editorial standards

Annuity details

$
$
%
yrs
yrs
%
Accumulation balance
$228,923
Monthly payout
$954
Total lifetime payout
$228,923
Investment growth
$78,923

Over 10 years your fixed annuity accumulates to $228,923, then pays $954/month for 20 years — $228,923 total.You invest $150,000 in premiums; investment growth adds $78,923, growing your nest egg by 53% before the payout phase begins.

Balance through accumulation and payout phases

Accumulation balance — premiums vs growth

By the KalkWise Editorial Team Reviewed for accuracy Updated June 2026

What is the annuity calculator?

In short

An annuity is an insurance contract that converts a lump sum or series of payments into a guaranteed income stream. During the accumulation phase, your premium grows at a fixed or projected rate. During the payout phase, the insurer pays you a set amount per month for a specified period or for life.

This annuity calculator projects both the accumulation phase (how your premium grows before retirement) and the payout phase (how much monthly income it generates), letting you compare fixed and variable annuity strategies.

How to use this calculator

  1. 1Choose fixed or variable annuity type.
  2. 2Enter your initial premium and any ongoing annual contributions.
  3. 3Set the expected annual return and accumulation period (years until payouts begin).
  4. 4Enter the payout period and annual payout rate.
  5. 5Review your projected accumulation balance and monthly income.

The formula

accumulation=(B+P)×(1+r)n
monthly payout=B×rate12
Accumulation: balance compounds with contributions each year at the stated rate. Payout: monthly income = final balance × payout rate / 12. Total lifetime payout = monthly income × payout months.
B
— Accumulation balance at annuitization
r
— Annual return/growth rate
p
— Annual payout rate

Worked example

The scenario

$100,000 initial premium, $5,000/year contributions, 5% fixed return, 10-year accumulation, 5% payout rate, 20-year payout period.

gives

The result

Accumulation balance: ~$244,000. Monthly payout: ~$1,017. Total lifetime payout: ~$244,000 over 20 years.

Common use cases

  • Planning a guaranteed income stream to supplement Social Security
  • Comparing the income potential of fixed vs variable annuities
  • Modeling a deferred annuity to start income at a future retirement date
  • Evaluating whether an annuity outperforms a bond ladder for retirement income

Limitations & assumptions

  • Fixed annuity rates are set by insurance companies and can vary significantly — compare multiple insurers.
  • Variable annuity projections use assumed rates; actual returns depend on the underlying investments.
  • Surrender charges (typically 7-year declining schedule) for early withdrawal are not modeled.
  • Annuity payouts can be structured as life-only, period-certain, or joint-and-survivor — this calculator models period-certain only.

Frequently asked questions

An annuity is a contract between you and an insurance company. You pay a premium (lump sum or installments), and in return the insurer provides guaranteed future income payments — either for a fixed period or for life.

Disclaimer: KalkWise calculators are provided for general informational and educational purposes only and do not constitute financial, investment, tax, or legal advice. Results are estimates based on the figures you enter and the assumptions described above. Actual outcomes will vary. Consult a qualified professional before making financial decisions.