# Annuity Payout Calculator

> Work out the regular income a lump sum can pay over a set number of years, or how long a chosen payout will last, while the balance earns interest.

Category: Finance · Applies to: Worldwide · Last updated: 2026-10-29
Interactive calculator: https://calculators.geekmidst.com/calculators/annuity-payout-calculator

A balance that keeps earning interest can pay out more than its face value. Choose a payout period to get the payment, or a payment to see how long the money lasts.

Also called: Withdrawal calculator, Drawdown calculator.

## Inputs
- Work out (options: Payout amount, How long it lasts; default amount)
- Starting balance (default 250000)
- Interest rate (per year) (unit %; default 5)
- Payout period (unit years; default 25)
- Payout per period (default 1500)
- Paid (options: Monthly, Quarterly, Yearly; default 12)
- Each payout made at (options: End of period, Start of period; default end)
- Currency

## Results
- Payout per period
- Number of payouts
- Money lasts
- Total paid out
- Interest earned during payout

## Formula

```
Payout = B × i ÷ (1 − (1 + i)^−n), divided by (1 + i) when paid at the start of each period;  How long: n = −ln(1 − B × i ÷ Payout) ÷ ln(1 + i) (end of period)
```

Where:
- B: starting balance
- i: annual rate ÷ payouts per year
- n: number of payouts

## Worked example
1. i = 6% ÷ 12 = 0.5%; n = 20 × 12 = 240.
2. Payout = 100,000 × 0.005 ÷ (1 − 1.005^−240) = 716.43 a month.
3. Total paid = 716.4311 × 240 = 171,943.45, of which 71,943.45 is interest.

**Result:** $100,000 earning 6% can pay $716.43 a month for 20 years, $171,943 in total.

## What the result means

The result is the level income that exactly uses up the balance. Withdrawing less leaves something over; withdrawing more runs the money out sooner. With investments rather than a fixed-rate account, returns vary, so keep a margin and recheck each year.

## Assumptions and limits
- The interest rate is fixed for the whole payout period.
- Payouts are level; there is no inflation increase.
- A life annuity from an insurer pays for life, not for a fixed period, and is priced on life expectancy and fees.
- Taxes on withdrawals are not included.

## Questions

### How long will my money last if I withdraw a set amount?

Choose “How long it lasts” and enter the payout. If the payout is no more than the interest the balance earns, the money never runs out and the calculator tells you so.

### Is this the same as the 4% rule?

No. The 4% rule is a rule of thumb for variable stock-and-bond portfolios with inflation increases. This calculator assumes a fixed return and level payments.

## Related calculators
- [Annuity Calculator](https://calculators.geekmidst.com/calculators/annuity-calculator)
- [Pension Calculator](https://calculators.geekmidst.com/calculators/pension-calculator)
- [Inflation Calculator](https://calculators.geekmidst.com/calculators/inflation-calculator)
- [Savings Goal Calculator](https://calculators.geekmidst.com/calculators/savings-goal-calculator)

_Returns are illustrations at a constant rate, not predictions or guarantees. Investments can lose value. This is not investment advice._

Source: GM¹X CalcVerse — https://calculators.geekmidst.com/calculators/annuity-payout-calculator