Immediate Annuity Calculator

Use this calculator to determine regular payouts for immediate annuities. Immediate annuities begin to pay out within a year of the purchase date, continuing until the initial investment + interest is exhausted. Not investing in immediate annuities? See our Deferred Annuity Calculator.

» Get Actual Quotes for Immediate Annuities

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*Results shown are estimates only and should not be confused with actual product performance.
We make no guarantees that results on this page correlate to actual products.

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The above calculator is good for estimating monthly payouts on fixed or lifetime annuities. Most fixed annuities are immediate, paying earnings on a monthly basis. Some fixed annuities are deferred, accumulating interest through the contract term with a single large withdrawal at the end. For deferred annuity calculations, click here.

How This Calculator Works

Rather than accumulating a large balance, immediate annuities issue periodic payments. The size of these payments is governed by how long you wish to receive them, how frequent they will be, how much you'll be investing up front, and the rate of return specified in the contract. After specifying these and other factors like inflation, this calculator will determine a periodic payout such that at the end of the contract term your balance is left empty.

This calculator graphs two data sets: 1) Annuity Balance, and 2) Total Payout. The overall balance left in your account at the end of each year is shown in orange. For immediate annuities, this balance reaches zero at the end of the term. The total paid out to you up to any given year is shown in green. This graph is always linear because the periodic payments are kept constant.

For more information on how fixed annuities work, see Fixed Annuity Guide.



Investment — The lump-sum amount invested up front in the fixed immediate annuity. Also known as the premium.

Payment Frequency — The payout structure specified in the annuity contract. "Monthly" is the typical payout term, but some contracts pay out yearly or quarterly.

Contract Term — Number of years the annuity contract will last. At the end of this term your initial investment + interest gets paid out completely, resulting in a zero balance, ending the annuity contract. Longer contract terms result in lower monthly payouts.

Expected Return — The % interest rate anticipated for the given contract term. In the case of fixed immediate annuities, this return is often guaranteed and specified in the contract.


Inflation Adjustment — Check this box to adjust payout calculations for inflation. Enter an average expected inflation rate for the duration of the contract. 3% is realistic.


  1. The contract term greatly affects payouts. Doubling from 5 to 10 years reduces monthly payouts by nearly half.
  2. Because immediate annuities don't accumulate interest, their tax-deferral benefits are greatly reduced. Deferred annuities are preferable for growth, immediate for retirement income.

Keep in mind that the above calculations are simply estimates. For an actual rate report of the most competitive annuities in today's market, contact a licensed specialist. Request a FREE Report.