Immediate Annuity Calculator

Answer 1

Immediate Annuity Calculator

An immediate annuity is a product sold by insurance companies that is designed to provide you with an income stream for life. The income, by definition, is designed to start immediately, although some immediate annuities allow you to defer payments for up to one year. It is very important to remember that once you set up an immediate annuity, you no longer control the money you put in it. Likewise, while the income stream is guaranteed for your lifetime, an untimely death will not result in any money being returned to your estate. This calculator is designed to help you estimate your monthly payments from an immediate annuity.

Answer 2

If you are retired or nearing retirement age, you might know about annuity investments that guarantee a fixed income for the rest of your life. Investing in an annuity, however, requires that you first pay a large sum of money, called a premium, in exchange for the lifetime annuity income. It is important to bear in mind that, unlike other types of investments, there are no eligible heirs that can receive the annuity investment income after the investor dies, because annuity income ends at the time of death.

You can use a free online annuity calculator

Since annuity investment premiums often involve large amounts of money, you need to understand the exact amount of monetary income you can expect to receive. An immediate annuity calculator can help you to determine the total amount of your monthly income payments. There are several websites that provide free online immediate annuity calculators to help people understand their monthly payments.

How to use a free online annuity calculator

Immediate annuity calculators are easy to use. All you need to do is enter the annuity investment amount, the annual interest rate, the number of years for the investor's life expectancy and whether the payments are monthly, quarterly or annually. An immediate annuity calculator helps an annuity investor to plan ahead.

If you are considering the possibility of investing in an annuity, it is a good idea to talk this over with a financial planner you trust before you sign any contracts. This prevents any future misunderstandings about how annuities work and how the payments are calculated.

Investing in an annuity without using an immediate annuity calculator means that the investor is not able to stay informed about how much income to expect. An investor who invests money in any type of investment involving interest rates or dividends needs to understand the interest or dividend rate in order to comprehend the total rate of return.