An income ladder calculator models a sequence of fixed-income contracts that mature on a schedule you set, so you can see exactly how much guaranteed monthly income each rung produces and when the principal returns. The calculator below lets you plug in your savings, term lengths, and current rates to size a real retirement income ladder in seconds — without spreadsheets.
Annuity Ladder Calculator
Build a MYGA ladder to balance yield and annual liquidity. Adjust terms, allocations, and rates; compare to a single-term benchmark.
Educational calculator only. Rates entered are illustrative and do not constitute an offer. Actual carrier rates, guarantees, surrender schedules, and product availability vary. Not tax or legal advice.
How to Use the Income Ladder Calculator
Start with three inputs: total dollars you want to allocate to the ladder, the number of rungs you want to build, and the term length of each rung. The calculator pulls live MYGA rates by term and shows the projected interest, end-of-term balance, and reinvestment yield for each rung.
Most retirees test two configurations: an even-money split across 3-, 5-, and 7-year rungs (the classic “income ladder strategy”), and a weighted split where the longest rung carries the most premium because long-term MYGA rates are usually higher. The calculator surfaces the difference in projected interest so you can pick the configuration that matches your need for liquidity versus yield.
What the Calculator Is Modeling
Under the hood, each rung is a multi-year guaranteed annuity (MYGA) or comparable fixed-income contract earning a fixed rate over a fixed term. The calculator does three things for each rung:
- Compounding: Applies the rate annually with tax deferral inside the contract, so interest earned in year 1 is compounding by year 2.
- Maturity schedule: Shows the date each rung matures and how much principal plus interest is available to reinvest or spend.
- Yield curve handling: Different rates for different terms reflect the current yield curve, so a 7-year rung typically projects higher interest than a 3-year rung.
Annuity Ladder Calculator vs CD Ladder Calculator
An annuity ladder calculator (the version above) and a CD ladder calculator model the same structure but with different tax assumptions. Annuity interest compounds tax-deferred until withdrawal; CD interest is taxed every year as ordinary income via a 1099-INT.
For an apples-to-apples comparison, the after-tax MYGA ladder typically beats the after-tax CD ladder by 1.5% to 2.5% per year on a $250,000 to $500,000 ladder, depending on the tax bracket. The lesson on MYGA Ladder vs CD Ladder walks through the exact math.
Sizing the Ladder to Your Income Gap
The calculator outputs an income estimate per rung, but the more important number is whether that income closes the gap between your essential expenses and your other guaranteed income sources (Social Security, pension). Two-step process:
Step 1: Run the retirement income gap analysis lesson to size the annual shortfall. For most retirees the gap lands somewhere between $0 and $30,000 a year.
Step 2: Use this calculator to find the ladder configuration that produces matching income. A $250,000 ladder spinning 5%-5.5% interest produces about $13,000 of interest annually plus principal returns spread over the rung terms.
Want a custom ladder priced by a producer?
A licensed producer will run live MYGA quotes by term, build the ladder against your specific gap, and provide a written plan. No cost, no obligation.
Get a Free Quote →What the Calculator Does Not Do
The calculator is a planning tool, not a quote. It uses representative rates by term, not live carrier-specific quotes. Actual rates depend on carrier, premium amount, state of issue, and product features. Surrender charges and free-withdrawal provisions vary by contract. The calculator assumes you hold each rung to maturity; partial withdrawals before maturity may trigger surrender fees.
For an exact dollar-and-cents quote on a specific carrier and product, the right next step is a producer-run illustration that prices the live contract against your premium, your age, and your timeline.
Sources & Further Reading
From MyAnnuityStore
- How to Build a Retirement Income Ladder (Lesson 1)
- MYGA Ladder vs CD Ladder (Lesson 2)
- Retirement Income Gap Analysis (Lesson 4)
- Today’s Best MYGA Rates (live)
External authorities
- U.S. Treasury: Treasury Yield Curve — the benchmark rates that drive MYGA pricing by term.
- IRS Publication 575: Pension and Annuity Income (PDF) — how compounded annuity interest is taxed.
What is an income ladder calculator?
An income ladder calculator models a sequence of fixed-income contracts (MYGAs, CDs, or short fixed annuities) that mature on a schedule you set, so you can see exactly how much guaranteed monthly income each rung produces and when the principal returns. It is a planning tool that converts a single dollar amount into a structured maturity schedule with projected interest, compounding, and reinvestment yields by term.
The calculator above lets you plug in total savings, number of rungs, and rung lengths to size a real retirement income ladder in seconds, then compare to a CD ladder, an annuity ladder, or a portfolio withdrawal strategy. Pair it with the income gap analysis lesson to size the ladder to the dollar amount your essentials actually require.
Income ladder calculator questions, answered
What is an income ladder calculator?
A planning tool that models a sequence of fixed-income contracts (MYGAs, CDs, or short fixed annuities) maturing on a schedule, showing projected interest, end-of-term balance, and reinvestment yield for each rung. It converts a single savings amount into a structured maturity schedule so you can see exactly how much income each rung produces and when the principal returns.
How is an annuity ladder calculator different from a CD ladder calculator?
They model the same structure but with different tax assumptions. Annuity (MYGA) interest compounds tax-deferred inside the contract; CD interest is taxed every year via a 1099-INT. On an apples-to-apples after-tax comparison for a $250k to $500k ladder, the MYGA ladder typically beats the CD ladder by 1.5% to 2.5% per year depending on the tax bracket.
Can I use the income ladder calculator for retirement income planning?
Yes, that is its main job. Combine it with a retirement income gap analysis to size the gap between your essential monthly expenses and your guaranteed income sources (Social Security, pension). Then use the calculator to find the ladder configuration that produces matching income. A $250k ladder spinning 5-5.5% interest produces roughly $13,000 of interest annually plus principal returns spread over the rung terms.
See the rates and income numbers for your situation.
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