Annuity Payout Calculator guide
Annuity Payout Calculator: Income From a Pension Pot
Use our annuity payout calculator to work out the monthly income a pension pot or lump sum could pay, or how long an income would last.
By the AllCalculator editorial teamUpdated 16 October 20261 min read
How much income could your pension pot pay, and how long would it last? Our Annuity Payout Calculator gives you an idea.
How to use the calculator (Annuity Payout Calculator)
- Enter your pension pot or lump sum.
- Enter the growth you expect while you draw it.
- Choose to work out the income for a set time or how long an income lasts.
- Choose whether to take 25% tax-free first.
How it works
The calculator works out the level monthly income that would use up the pot over the period, allowing for growth on what's left. This is how drawdown works if you take a steady income.
A worked example
With the calculator's default settings, a £200,000 pot growing at 4% could pay about £1,048 a month for 25 years.
Annuity or drawdown?
| Lifetime annuity | Drawdown | |
|---|---|---|
| Income | Guaranteed for life | Flexible, not guaranteed |
| Investment risk | None | You keep it |
| Rates depend on | Age, health, interest rates | Investment returns |
Frequently asked questions
Is the income taxed?
Yes, like earnings, apart from any tax-free cash.
Where can I get help?
Pension Wise from MoneyHelper offers free, impartial guidance if you're 50 or over.
Sources and further reading
Links open official and independent websites in a new tab.
This guide is general information to help you understand your options. It isn't financial, tax, legal or building advice and doesn't take your personal circumstances into account. Figures were checked when the guide was last updated and can change, so confirm anything important with GOV.UK, HMRC, a regulated adviser or a qualified tradesperson.