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Annuity Calculator

Calculate the future value of a fixed annuity with regular contributions.

Result

Future Value
$90,755.20
Total Contributions
$59,000.00
Total Interest
$31,755.20
BalanceContributions
$200K$150K$100K$50K$0Balance - Yr 1: $9KBalance - Yr 2: $13KBalance - Yr 3: $17KBalance - Yr 4: $22KBalance - Yr 5: $27KBalance - Yr 6: $32KBalance - Yr 7: $37KBalance - Yr 8: $43KBalance - Yr 9: $49KBalance - Yr 10: $55KBalance - Yr 11: $61KBalance - Yr 12: $68KBalance - Yr 13: $75KBalance - Yr 14: $83KBalance - Yr 15: $91KContributions - Yr 1: $9KContributions - Yr 2: $12KContributions - Yr 3: $16KContributions - Yr 4: $19KContributions - Yr 5: $23KContributions - Yr 6: $27KContributions - Yr 7: $30KContributions - Yr 8: $34KContributions - Yr 9: $37KContributions - Yr 10: $41KContributions - Yr 11: $45KContributions - Yr 12: $48KContributions - Yr 13: $52KContributions - Yr 14: $55KContributions - Yr 15: $59KYr 1Yr 3Yr 5Yr 7Yr 9Yr 11Yr 13Yr 15

About the Annuity Calculator

A fixed annuity grows your money at a guaranteed rate over an accumulation period, similar to a CD but often over a longer horizon and sometimes with regular ongoing contributions. Our Annuity Calculator projects that growth from an initial deposit plus monthly contributions.

How It Works

The calculator compounds your initial deposit and adds your monthly contribution each period at your annuity's fixed annual rate, tracking the running balance over your chosen accumulation period to find the future value at the end of the term.

Formula & Methodology

A fixed annuity's accumulation phase behaves mathematically just like a CD or savings account earning compound interest - an insurance company guarantees the rate rather than a bank, but the growth math itself is identical lump-sum-plus-contributions compounding. What makes an annuity structurally different shows up later, in the payout phase and in the fees and surrender terms built into the actual contract, none of which factor into this pure accumulation-phase growth projection.

Step-by-Step: Calculating It By Hand

  1. 1Convert the annuity's annual guaranteed rate to a monthly rate.
  2. 2Compound the initial deposit forward using that monthly rate over the accumulation period.
  3. 3Add the compounded value of monthly contributions using the annuity growth formula.
  4. 4Sum both components for the projected balance at the end of the accumulation period.

Examples

Long accumulation period

A $5,000 initial deposit plus $300/month at 5% over 15 years grows to a balance well above total contributions, with a meaningful share coming from interest.

Shorter horizon

The same contribution pattern over just 5 years accumulates far less, since compound growth needs time to build meaningfully.

Advantages

  • Models the guaranteed, predictable growth structure of a fixed annuity
  • Shows the split between contributions and interest earned
  • Useful for comparing an annuity's projected growth against other guaranteed-return products like CDs
  • Works for any combination of initial deposit and ongoing contribution

Common Mistakes

  • Not accounting for annuity fees and surrender charges, which this simplified projection doesn't include
  • Confusing a fixed annuity's guaranteed rate with the higher (but variable) returns of a variable annuity
  • Locking money into a long accumulation period without understanding withdrawal restrictions
  • Not comparing the annuity's rate against other guaranteed options like CDs or Treasury bonds

Edge Cases to Watch For

  • Real annuity contracts often include annual fees (mortality and expense charges, administrative fees) that reduce the effective growth rate below the stated guaranteed rate.
  • Surrender charges apply if funds are withdrawn during an early surrender period, typically the first 5-10 years of the contract.
  • Withdrawals before age 59½ can trigger a 10% IRS early withdrawal penalty on the earnings portion, similar to other tax-deferred retirement vehicles.
  • A variable annuity's returns fluctuate with underlying investments rather than following this fixed, guaranteed-rate projection.

Common Use Cases

  • Projecting the growth of a fixed annuity during its accumulation phase
  • Comparing an annuity against a CD or high-yield savings account
  • Planning how much to contribute to reach a specific future value
  • Understanding the mechanics behind an annuity sales illustration
Written & fact-checked by the Calculateus TeamLast updated August 5, 2026How we verify our formulas

Frequently asked questions

What's the difference between this and a savings account?

A fixed annuity is an insurance product with a guaranteed rate over a set accumulation period, generally less liquid than a savings account but often offering higher guaranteed rates in exchange for that reduced flexibility.

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Conclusion

Annuities can offer valuable guaranteed growth, but real products include fees and surrender charges this simplified model doesn't capture - read the actual contract carefully before committing. Once your annuity reaches its payout phase, our Annuity Payout Calculator estimates what you could withdraw from it.

References