Annuity Payout Calculator
Convert a lump sum into fixed monthly income for a chosen period.
Payout Details
Monthly Payout
How the payout works
A lump sum of 5,000,000 at 6% over 20 years pays about 35,700 monthly — roughly 8,500,000 in total. The extra 3,500,000 is the interest earned by the money still invested, which is exactly what makes the income last the full period.
Annuity Payout FAQ
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Annuity Payout Calculator — income from your lump sum
You've built a corpus — now how much can you safely withdraw each month? This annuity payout calculator answers it: given your lump sum, rate and the number of years, it computes the exact monthly payout, total payout and interest portion.
The payout formula
Monthly payout = P × r ÷ [1 − (1+r)^−n], where P is the lump sum, r the monthly rate and n the number of months.
A $50,00,000 corpus at 6% for 20 years pays about $35,800/month.
Extending to 30 years drops the payout to about $30,000/month — trade income for longevity.
Planning the withdrawal rate
A 4% annual withdrawal is the classic conservative rule for a 30-year retirement; at 6% return you'd withdraw ~4% and keep the rest growing.
This fixed-period payout spends both principal and interest — your corpus hits zero at the end.
For lifetime income instead, consider an immediate annuity product or a withdrawal policy tied to market performance.
How to use this calculator
- Enter your lump sum (retirement corpus).
- Input the expected annual return.
- Set the number of years income must last.
- Read the monthly payout, total payout and interest earned.
Pro tips
- Be conservative with the return during withdrawal phase — 5–6% is prudent.
- Add inflation: a fixed payout buys less every year. Consider an inflation-indexed withdrawal.
- Keep 2–3 years of expenses in cash to avoid selling investments in a downturn.