How to Estimate Payment with Annuity Calculators

Annuities are used by investors for income during their retirement years. There are different types of annuities contracts sold by insurance companies: Fixed, variables, immediate, deferred. One of the components for making a decision to buy an annuity is how much income or monthly payment it will provide. Use these tips to help you calculate your payment with an annuity calculator.

Instructions

1. Determine the type of annuity contract purchased. Each annuity provides payments based on a contract. Read your contract or find out from the insurance company which contract you have purchased. Fixed annuity, Variable, Deferred or Immediate annuity are the most common types of contracts sold.

2. 

   Understand the terms of the annuity contract to find the payouts. This will depend on the type of contract - immediate or deferred. Find the following terms: the initial invested amount or the periodic premiums, frequency of payment - monthly, quarterly etc., the contract terms - the number of years for the annuity, and the expected percentage return.

3. Find an annuity calculator to estimate payments. There are many free services that provide annuity calculators on the internet. You can also visit insurance companies online; most of these provide free annuity calculators.

4. Enter the annuity contract terms on the calculator to project monthly or quarterly payments. Make sure to select the correct annuity contract - immediate, deferred, fixed or variable in order to obtain an accurate annuity payment estimate.