What is an ordinary annuity?

Its fixed cash flow occurs at the end of each period.

What is an annuity due?

Its fixed cash flow occurs at the beginning of each period, including an immediate first payout.

Why is the due payout lower at a positive rate?

Every payment is made one period earlier, leaving less balance to earn interest before that cash flow.

Are fees, taxes or surrender charges included?

No. The calculator also excludes riders, commissions, mortality credits and insurer-specific guarantees.

Does the final balance always equal exactly zero?

The unrounded equation amortizes to zero mathematically. Display rounding can create a very small apparent difference in real contracts.

Fixed Annuity Payout from Present Value

Compare end-of-period ordinary timing with beginning-of-period annuity-due timing.

Fixed periodic payout

Ordinary versus due timing

Year-end balance summary

CurrencyPresent value available for payoutsThe modeled balance at the start, before any beginning-of-period payout.Fixed nominal annual rateA hypothetical rate you enter; not an insurer, bank or market quote.Payout term in yearsPayout frequencyPayout timing

How to Estimate a Fixed Payout

Enter one deterministic present-value scenario. Do not substitute the result for an insurer's contract illustration or disclosure.

Select a display currency; the calculator performs no conversion.

Confirm timing first

A due payout occurs one period earlier than an ordinary payout. With a positive rate, that makes each sustainable due payout lower for the same present value and term.

A Present-Value Equation, Not an Insurance Illustration

This page solves for equal withdrawals that exhaust a present value over a fixed number of periods under a constant nominal rate. Ordinary timing applies interest before each end-of-period payout. Due timing pays first, then applies interest to the remaining balance. The result is not based on age, life expectancy, mortality pooling, insurer expenses, riders or contract guarantees, so it must not be interpreted as an immediate-annuity quote.

Fixed Payout Examples

Ten-year ordinary monthly payout

Present-value assumptions

presentValue:100000

annualRate:6%

years:10

payoutsPerYear:12

timing:end

Estimated payout

$1,110.21 per month

The equation models 120 equal end-of-month payouts and a fixed 0.5% monthly rate.

Zero-rate payout

Present-value assumptions

presentValue:12000

annualRate:0%

years:1

payoutsPerYear:12

Estimated payout

$1,000 per month

With no interest, present value is divided evenly by the 12 payouts.

This is not a quote

Compare the result only with a contract illustration that documents product-specific charges, guarantees and payout terms.

Frequently Asked Questions

No. It is a generic present-value calculation with no insurer, contract, mortality or guarantee data.

Still have questions about this calculation?

Try the Calculator

Present-Value Annuity Formula

The fixed payout is derived from present value, periodic rate, number of payouts and cash-flow timing.

Formula

PMT = PV × i / (1 − (1+i)^−N)

Ordinary annuity

PMT = PV × i / (1 − (1+i)^−N)

Annuity due

PMT_due = PMT_ordinary / (1+i)

Zero-rate branch

PMT = PV / N

Scientific Background

Investor.gov describes annuities as contracts that can involve fees, surrender charges, tax considerations and insurer guarantees. This calculator implements only the generic time-value-of-money equation and none of those product features.