Annuity Break-Even Calculator
An immediate annuity converts a lump sum into guaranteed lifetime income. This calculator helps you compare the trade-offs: higher guaranteed income vs. keeping control of your principal.
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Compare an immediate annuity to keeping your money invested.
What you'd earn if you kept the money invested instead
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"Calculate" to see your results
What is an immediate annuity?
A Single Premium Immediate Annuity (SPIA) is a contract where you give an insurance company a lump sum, and in return they pay you a guaranteed monthly income for the rest of your life — no matter how long you live.
The break-even point is when you've received back your original principal in payments. If you live beyond this point, you're "ahead" compared to if you'd kept the money and withdrawn it yourself.
Pros and cons of annuities
- Guaranteed income you can't outlive
- No investment decisions or market risk
- Higher payout rates than most safe investments
- Simplifies retirement budgeting
- You give up access to your principal
- If you die early, the insurance company keeps the rest
- No inflation adjustment (unless you pay extra)
- Less flexibility for emergencies
Considering an annuity?
Annuities can be complex, and the right choice depends on your overall financial picture. Consider speaking with a fee-only financial advisor who doesn't earn commissions on annuity sales.
Get free Medicare helpThis calculator is for educational purposes only and does not constitute investment, tax, or financial advice. EnrollMedicare.com is not a registered investment advisor, broker-dealer, or financial planner. We do not sell annuities or investment products. Annuity payout rates shown are illustrative estimates based on industry averages and may vary significantly by insurance company, state, health status, and current interest rates. Investment return assumptions are hypothetical and do not guarantee future results. Past performance does not guarantee future returns. Consult a licensed financial professional, tax advisor, or attorney before making any investment or retirement income decisions.