How Much Does a Fixed Annuity Pay?
A $100,000 fixed annuity paying a guaranteed 6% generates about $6,000 a year, or roughly $500 a month, in interest. Leave that interest to compound instead of taking it as income, and the same contract grows to about $133,823 after five years, all tax-deferred. Your exact payout depends on the rate you lock in, your premium, and your term. Use the calculator below to project the future value of a fixed annuity or MYGA: enter your premium, the guaranteed annual rate, and the contract term, and you get a year-by-year growth schedule plus a tax-aware comparison to a CD at the same rate.
Fixed Annuity / MYGA Growth Calculator
See exactly what your fixed annuity will be worth at maturity, plus a year-by-year growth schedule and a tax-aware comparison vs a CD at the same rate.
At End of Term
| Total interest earned | |
| Effective annual yield (APY) | |
| If withdrawn at maturity (after tax) | |
| Equivalent CD ending value (interest taxed yearly) | |
| MYGA tax-deferral advantage |
Year-by-Year Growth
The CD comparison assumes interest earned in a CD is taxed each year at your marginal rate, while MYGA interest compounds tax-deferred until withdrawal. Actual MYGA rates change daily - see today's top MYGA rates across 50+ top annuity companies.
How a fixed annuity calculator works: it compounds your premium at the contract’s guaranteed rate for the full term, defers the tax on each year’s interest, and shows the end-of-term value. Because the interest is never taxed along the way, a fixed annuity finishes the term with more money than a CD paying the identical rate.
How to Use the Fixed Annuity Calculator
You only need three inputs to get an accurate projection.
- Enter your premium. This is the lump sum you plan to place in the annuity, for example $100,000. Use the amount you would actually move from a CD, savings, or maturing annuity.
- Enter the guaranteed rate. Type the locked annual rate the contract offers, such as 5.50%. If you are not sure what is available, check today’s top fixed annuity rates first.
- Choose the term. Select the number of years the rate is guaranteed, typically 3 to 10. Then read the year-by-year schedule and the tax-aware CD comparison the calculator returns.
How a Fixed Annuity Grows
A fixed annuity (also called a Multi-Year Guaranteed Annuity, or MYGA) is a contract with an insurance company that pays a guaranteed interest rate for a set term, typically 3 to 10 years. Interest compounds tax-deferred inside the contract. You owe no taxes on the growth until you withdraw it. That single feature is what makes a MYGA compound faster than a CD at the same headline rate. The IRS treats this deferral under the rules for annuity income in IRS Publication 575.
MYGA vs CD: Why the Math Wins
A 5-year CD paying 5.50% sounds identical to a 5-year MYGA paying 5.50%. But interest in a CD is taxed every year, even if you don’t withdraw it, while interest in a MYGA stays in the contract and compounds untouched. After 5 years at 5.50%, the MYGA’s account value reaches about $130,696, versus about $123,099 of after-tax value in the CD. You still owe ordinary income tax on the MYGA’s gain when you eventually withdraw it, so if you cashed out the whole contract at year 5 in a 22% bracket, the after-tax edge over the CD is smaller, on the order of $700. That gap widens the longer you let the balance compound, the higher your tax bracket while the CD is taxed each year, and especially if you withdraw in retirement when your bracket may be lower. You can run the comparison for your own numbers in our fixed annuity vs CD calculator.
Example: $100,000 in a 5-Year Fixed Annuity
The table below shows how a hypothetical $100,000 premium grows at a 5.50% guaranteed rate, compounded annually, with no withdrawals. Figures are illustrative and assume the contract is held to term.
| Year | Starting Value | Interest at 5.50% | End-of-Year Value |
|---|---|---|---|
| 1 | $100,000 | $5,500 | $105,500 |
| 2 | $105,500 | $5,803 | $111,303 |
| 3 | $111,303 | $6,122 | $117,424 |
| 4 | $117,424 | $6,458 | $123,882 |
| 5 | $123,882 | $6,814 | $130,696 |
After five years the contract has earned $30,696 in guaranteed, tax-deferred interest, none of which was taxed along the way.
A Real Example: How Linda Uses the Calculator
Linda is 62 and three years from retirement. A $150,000 CD just matured, and she wants safety without giving up growth. She is comparing a renewed CD at 5.50% to a 5-year MYGA at the same rate.
Linda opens the calculator and enters a $150,000 premium, a 5.50% guaranteed rate, and a 5-year term. The year-by-year schedule shows her balance climbing from $150,000 to about $196,044 at the end of year five, roughly $46,044 of guaranteed interest, none of it taxed until she withdraws.
The tax-aware comparison tells the rest of the story. In a CD, Linda would owe tax on the interest every year at her 22% bracket, dragging her ending balance down to about $184,649. The MYGA leaves her with roughly $11,400 more, simply because the interest was never interrupted by an annual tax bill. Linda decides to ladder $75,000 into a 3-year MYGA and $75,000 into a 5-year MYGA so part of her money frees up sooner.
Your own numbers will differ based on the rate you lock in and your tax bracket, but the pattern holds: at the same rate, tax deferral lets the annuity finish ahead.
Fixed Annuity vs Fixed Index Annuity
This calculator models a fixed-rate annuity, where the rate is locked for the full term. A fixed index annuity works differently: instead of a fixed rate, it credits interest linked to a market index such as the S&P 500, up to a cap or participation rate, with a 0% floor that protects your principal in down years. If you want to model a guaranteed lifetime income rider instead of pure accumulation, use the income rider calculator, or estimate a guaranteed paycheck with the immediate annuity calculator.
What Compounding Frequency Actually Does
Most MYGAs credit interest annually. Some credit semi-annually or monthly. The difference at a 5.50% rate is small, about $200 over 5 years on a $100,000 contract between annual and monthly compounding. The bigger driver of total return is the rate itself and the tax treatment, not the compounding frequency. If you want to see the mechanics on their own, try the compound interest calculator.
Surrender Charges and Free Withdrawals
The calculator assumes you hold the contract to the end of the surrender period. Withdraw early and you face surrender charges, typically 6-9% in year 1, declining to 0% by the end of the term. Most MYGAs allow you to take out 5-10% per year penalty-free, and many waive surrender charges entirely for nursing home confinement or terminal illness. Read more about surrender charges.
Who Should Use a Fixed Annuity Calculator
A fixed annuity calculator is most useful if you are comparing a MYGA to a CD or money market, deciding between contract terms, or sizing how much guaranteed growth a portion of your savings can produce before retirement. For current numbers, check today’s top fixed annuity rates and the best fixed annuity companies, then run the figures above.
Frequently Asked Questions
Is a MYGA safer than a CD?
Both are very safe but backed differently. CDs are FDIC-insured up to $250,000 per depositor per bank. MYGAs are backed by the issuing insurance company, with state guaranty associations providing a backstop (typically $250,000-$300,000 per contract). You can confirm your state’s coverage limit through the National Organization of Life and Health Insurance Guaranty Associations (NOLHGA). For amounts above the FDIC limit, MYGAs from highly-rated carriers are competitive on safety and usually beat CDs on rate.
What happens at the end of the surrender period?
You typically have a 30-day window to make a decision. Options: (1) take a lump sum, (2) renew at the carrier’s then-current rate, (3) execute a 1035 exchange to a new MYGA at a different carrier, or (4) annuitize for a guaranteed income stream. Many people roll into a new MYGA at the highest available rate.
How is MYGA interest taxed?
Inside the contract, interest is tax-deferred, with no tax until withdrawal. When you withdraw, the interest portion is taxed as ordinary income (not as long-term capital gains). If you bought the MYGA with non-qualified (after-tax) money, your original premium returns to you tax-free. If you bought with IRA or 401(k) money, the entire withdrawal is taxable.
What rate should I expect today?
As of 2026, top MYGA rates run roughly 5.0-5.7% for 3-year, 5.4-6.3% for 5-year, and 5.5-6.3% for 7-year terms, varying by carrier rating and contract size. See today’s top MYGA rates updated daily.
Can I withdraw interest annually?
Most MYGAs offer two interest crediting modes: full tax deferral (interest stays in the contract) or systematic withdrawal of interest (you take the interest as monthly or annual income while the principal stays untouched). The latter mode forfeits some of the tax-deferral advantage but provides current income.
How much does a $100,000 fixed annuity pay?
At a 5.50% guaranteed rate compounded for 5 years, a $100,000 fixed annuity grows to roughly $130,696 if you let it compound, or pays about $5,500 per year (around $458 per month) if you take the interest as income and leave the principal intact. Your exact figures depend on the rate and term you lock in.
Are online fixed annuity calculators accurate?
A fixed annuity calculator is highly accurate for fixed-rate (MYGA) contracts because the rate is guaranteed and the math is fixed. The main variables that change your real-world result are the rate you actually lock in, the compounding mode, and whether you take penalty-free withdrawals. The financial-industry regulator FINRA offers a plain-language primer on understanding your annuity if you want a neutral third-party explainer. For a personalized quote across 90+ top annuity companies, request a free quote.
