Annuity Parameters

Initial investment amount for your annuity
Additional amount contributed each year
Additional amount contributed each month
Expected annual return on investment
Number of years for the annuity to grow
When payments are made each period

Note: This calculator shows the accumulation phase of annuities. Tax-deferred growth may apply.

Results

$175,533
End Balance
$20,000
Starting Principal
$100,000
Total Additions
$55,533
Total Interest
8.77%
Annualized Return

Analysis

πŸ“ˆ Excellent Growth

Your annuity shows strong accumulation potential with compound interest working in your favor.

Balance Composition

Principal: $20,000 (11%)

Additions: $100,000 (57%)

Interest: $55,533 (32%)

Accumulation Schedule
Year
Ending Balance
Year 5
$86,518
Year 10
$175,533
Year 15
$291,776

Key Benefits

  • Tax-deferred growth on earnings
  • Compound interest acceleration
  • Regular contribution discipline
  • Retirement income security
  • Protection from market volatility (fixed annuities)

Understanding Annuities

What is an Annuity?

An annuity is a financial product that provides regular payments in exchange for a lump sum or series of payments. During the accumulation phase, your contributions grow tax-deferred through compound interest.

Tax-Deferred Growth

Annuities are popular retirement planning tools because they offer guaranteed growth and can provide steady income during retirement, with tax advantages during the accumulation phase.

Annuity Types

Fixed Annuities: Guaranteed interest rate with predictable growth

Variable Annuities: Returns based on investment performance

Indexed Annuities: Returns tied to market index with downside protection

Payment Timing

  • Ordinary Annuity: Payments made at the end of each period
  • Annuity Due: Payments made at the beginning of each period
  • Timing Impact: Beginning payments result in higher accumulation
  • Compound Effect: Extra compounding time increases final value

Retirement Planning Benefits

  • Guaranteed Income: Provides predictable retirement income stream
  • Tax Advantages: Tax-deferred growth during accumulation phase
  • Longevity Protection: Some annuities provide lifetime income guarantees
  • Discipline: Encourages regular savings and investment habits