Irish Calculators
Loans & mortgages

Fixed-Term Annuity Withdrawal Calculator

Turn a capital amount into monthly withdrawals for a specified number of payments. The result is a fixed-term financial scenario without mortality tables, tax rules or insurer guarantees.

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Your numbers

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How the calculation works

Turn capital into equal monthly withdrawals over a fixed term while retaining a chosen final balance. This deterministic scenario uses a supplied return; it is not a lifetime-annuity quote or income guarantee.

Monthly payout = [capital − residual/(1+i)^n] / annuity PV factor; i = (1 + effective annual return)^(1/12) − 1.

  1. Convert the return

    Find the monthly rate whose twelve-period growth equals the effective annual return. This same rate is assumed throughout the modelled term.

  2. Reserve final capital

    Discount the desired residual to today and subtract it from starting capital. The remaining present value is available to fund withdrawals.

  3. Solve the payout

    Divide that available value by the annuity factor for the timing and payment count. At zero return, divide capital less residual evenly over payments.

Worked example: Zero-return payout with retained capital

Sample inputs demonstrate the method. They are not a forecast or product offer.

The example starts with €1,200, retains €200 and assumes zero return for ten months. The remaining €1,000 funds withdrawals of €100 monthly, giving €1,000 total payouts and preserving the specified final capital.

Available capital
1200
Capital to retain at the end
200
Effective annual return after fees
0
Number of monthly payments
10
Payment timing
End of each month

Expected result

Monthly payout
€100.00
Total payouts
€1,000.00
Worked example: One month at one percent effective monthly

Sample inputs demonstrate the method. They are not a forecast or product offer.

Available capital
1000
Capital to retain at the end
0
Effective annual return after fees
12.682503013196978
Number of monthly payments
1
Payment timing
End of each month

Expected result

Monthly payout
€1,010.00
Total payouts
€1,010.00

Understanding your result

The result assumes a smooth return. Actual investment returns can vary in amount and sequence, so a matching average annual return does not guarantee the same withdrawal outcome.

Taxes, mortality and insurer pricing are absent. Payments can consume principal and should not be interpreted entirely as investment income.

Questions you might have

Can this price a lifetime annuity?

No. A lifetime annuity needs insurer pricing and longevity assumptions that this fixed-term calculation does not supply.

Choosing the right inputs

Effective annual return after fees
Enter an effective annual return after fees. The monthly compound rate uses the twelfth root, rather than simply dividing this annual percentage by twelve.
Capital to retain at the end
Supply capital to retain at term end. That future balance must be funded alongside withdrawals rather than being treated as immediately spendable.
Number of monthly payments
Enter the number of monthly payments. They stop after this count, regardless of lifespan or a later need for income.
Payment timing
Beginning withdrawals leave less capital earning the month's return than end withdrawals, changing the calculated equal payment.

Common mistakes to avoid

  • Do not substitute a nominal annual rate for an effective annual return without conversion.
  • Do not describe a fixed-term withdrawal as lifelong income or assume retained end capital is also available for earlier spending.

Assumptions to check

  • Payments stop after the specified term; no mortality tables, insurer guarantees or tax rules are included.

Sources and method

Read our calculation and testing approach.