THE NUMORIX GUIDE
How to use the Annuity Payout Calculator
Last reviewed September 14, 2026
What this calculator does
For a fixed length, the engine converts the annual rate to ratePerPeriod = annual rate / periods per year and uses the ordinary amortization payment for the principal over yearsToPayout x periods.
Formula and method
For a fixed length, the engine converts the annual rate to ratePerPeriod = annual rate / periods per year and uses the ordinary amortization payment for the principal over yearsToPayout x periods. For a fixed payment, it solves the number of periods with a logarithmic payoff formula. Each schedule row charges periodic interest before subtracting the payment.
Variables and inputs
Choose Fix Length or Fix Payment. Enter starting principal, annual interest/return rate, years to payout for fixed length or payment amount for fixed payment, and payout frequency from annual through biweekly. Payment and principal are dollars; rate is annual percent.
Worked example
For $100,000 at 6% over 10 years with monthly payouts, r = 0.06 / 12 = 0.005 and n = 120. The payment is 100000 x 0.005 x 1.005^120 / (1.005^120 - 1) = about $1,110.21. Total payments are about 120 x 1,110.21 = $133,225 and modeled interest is about $33,225.
How to interpret the result
Fix Length answers how much each regular payout must be to exhaust the starting principal under the assumed rate. Fix Payment answers how long a chosen payout lasts. A positive interest assumption can make a payment that looks large enough mathematically still fail if it is at or below the first period's interest; the current route does not explicitly validate that case.
Common mistakes to avoid
Match the payment frequency to the rate conversion. Do not enter an annual payment while selecting monthly. Do not interpret total payments as profit because they include the returned principal.
Assumptions and limitations
The calculation uses nominal annual rate divided by frequency, regular payments, and no fees or taxes. It is not an insurer's lifetime-income calculation and does not model inflation, mortality, withdrawals, or variable returns. Fixed-payment inputs that are too low can create non-finite or non-useful results.