IFR Module 240 -- Annuity Income & Breakeven Analysis
Annuitization: Converting a lump sum into a guaranteed income stream for life. This calculator models annuity income, calculates the tax exclusion ratio, projects breakeven timing, and compares annuitization against systematic withdrawal to help determine which strategy best fits your retirement plan.
Annuity Parameters
Lump sum to annuitize
Current age at purchase
Annual payout percentage of premium
Age when income begins
Ordinary income tax rate
Return if kept invested instead
Withdrawal rate if kept invested
Guaranteed Annual Income
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Monthly Income
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Exclusion Ratio
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Tax-free portion
Annual Tax on Income
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Net Annual Income
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After taxes
Breakeven Analysis
How many years until you've received back your entire premium through annuity income payments.
Compare guaranteed annuity income against self-managing through systematic withdrawals. The annuity provides certainty; systematic withdrawal provides flexibility but carries risk.
Legacy Value Comparison
What remains for heirs under each strategy at different ages.
Year-by-Year Income Schedule
Age
Year
Gross Income
Tax-Free Portion
Taxable Portion
Tax
Net Income
Cumulative Received
Disclaimer. Third-party product names and methodology names are the property of their respective owners. Reference does not imply endorsement or affiliation. This tool is the work product of Nate Cocco; the analysis is reviewed by Nate before any client recommendation.