Retirement Income
An immediate annuity turns a lump sum of savings into a guaranteed paycheck for life. You hand an insurer a single premium, and in return they pay you a fixed monthly income you can't outlive — no market risk, no chance of running out.
Enter your premium and age below to see how much monthly income it would generate, the payout rate, the break-even age where you've recovered your premium, and your total income by life expectancy.
An annuity's strength is certainty — a paycheck for life that removes both market risk and the risk of outliving your money. The cost is liquidity and legacy: a basic single-life annuity stops paying when you die and generally can't be cashed out, so there's nothing left for heirs unless you add a survivor or period-certain rider (which lowers the income). Many retirees annuitize just enough to cover essential expenses and keep the rest invested for growth and flexibility.
If you're weighing guaranteed income against investing the money yourself, that's the same math as a pension-vs-lump-sum decision: compare the annuity's implied return to what you could safely earn. Run both sides with the tool below.
For a single-premium immediate annuity, $100,000 typically pays roughly $560–$685 a month for life depending on your age — about $615 a month at age 65 (≈7.4% of the premium per year). Older buyers receive more. Exact amounts vary by insurer, interest rates, and payout options.
The insurer applies a payout rate based on your age and current interest rates. Annual income = premium × payout rate; monthly income is that divided by 12. The rate rises with age because payments are expected over fewer years.
A contract you buy with one lump-sum payment in exchange for guaranteed income that starts almost immediately and lasts for life. It converts savings into a paycheck you can't outlive, removing market and longevity risk — but you generally give up access to the principal.
If bought with pre-tax (IRA/401k) money, every payment is fully taxed as ordinary income. If bought with after-tax money, each payment is part tax-free return of principal and part taxable earnings until your principal is recovered.