Calculate annuity payments, present value, and future value for fixed, variable, and indexed annuities with payout projections.
This calculator projects an annuity's future value from a stream of contributions, or its present value from a target payout, using standard time-value-of-money formulas rather than a quote from a specific insurance carrier. You enter the payment amount, an assumed interest or crediting rate, the compounding/payment frequency, and the term, and it separates the money you put in from the interest actually credited over that term. The detail people miss most: for variable and indexed annuities, the rate is your own assumption -- the tool has no way to know your contract's cap rate, participation rate, or spread, so the projection is only as good as that input.
A concrete input and expected output from the current implementation.
Input
Monthly deposit $500; annual rate 6%; compounding monthly; term 20 years; ordinary annuity (deposits at the end of each month)
Expected output
Future value approximately $231,020.45 (total contributions $120,000.00 plus interest credited approximately $111,020.45)
Using FV = PMT x [((1+r)^n - 1) / r] with a monthly rate r = 0.06/12 = 0.005 and n = 240 monthly periods, 500 x [(1.005^240 - 1) / 0.005] = 500 x 462.0409 = 231,020.45.
For a fixed periodic rate, the tool applies the standard ordinary-annuity formulas FV = PMT x [((1+r)^n - 1)/r] and PV = PMT x [(1-(1+r)^-n)/r], where r is the rate per period and n is the number of periods. An annuity-due option (payments at the start of each period rather than the end) multiplies the result by (1+r) to shift the payment timing.
Contributions are grown to a projected balance at your assumed rate (the accumulation phase), and that balance can then be amortized into a level payout over a chosen number of payout years, at the same or a different assumed rate (the payout/annuitization phase). This mirrors how a deferred annuity converts savings into an income stream, but the two phases are computed independently.
No. The projection assumes the full contribution and payout schedule runs to term as entered; it does not subtract surrender charges, market value adjustments, or other early-withdrawal penalties that a real annuity contract may impose.
Not directly. You enter one assumed annual rate as a stand-in, and the calculator doesn't apply an index's actual cap, floor, or participation rate. A workable approach is to run it once at your contract's guaranteed minimum rate and once at a plausible average credited rate to bracket the range.
The example and behavioral notes were checked against the browser implementation. Standards and primary references below define the relevant format, formula, or platform behavior.
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