How Much Does a $100,000 Annuity Pay Per Month?
If you are approaching retirement you are likely beginning to plan how you will generate the retirement income you need to cover your essential living expenses without the risk of ever running out of money. If you are considering an annuity for a portion of your retirement nest egg you may be wondering just how much an annuity would pay you per month.
In this guide we will tell you exactly how much monthly income an annuity will generate assuming a $100,000 investment. We’ll provide income payments for several scenarios, including immediate income for a 60 and 65 year old, and monthly income for 60 year old deferring payments for 5 years.
Using the latest annuity quoting software we’ve researched more than 300 annuity riders from 56 of the top insurance companies to find out exactly how much $100,000 annuity would pay you per month.
If you are looking to invest $150,000 into an annuity you can simply multiply the income amount for $100,000 by 1.5 to get the monthly income for $150,000.
Our annuity calculator can also work the numbers backwards and calculate the investment amount needed to generate a certain monthly income amount at a specific age.
For a personalized annuity quote please contact us by phone at 855-583-1104 or via email at firstname.lastname@example.org. If you click on the blue button below you’ll be redirected to our annuity quote request page where you can complete an online annuity quote request form.
Best Lifetime Income Annuity Payouts
How much does a $100,000 annuity pay per month?
After quoting more than 300 annuity income riders from 56 insurance companies we’ve compiled the 20 best annuity income rates for a $100,000 investment at age 60; with monthly income beginning at age 65. The table below lists the top 20 annuities, in order, beginning with the highest income payments. You’ll notice we’ve listed the income payments in monthly and annual income payments as you may select either income option.
|INCOME RIDER||A.M. BEST||FEE||MONTHLY||ANNUAL|
|Ameritas Flexmark MyFit Income Rider with Booster||A||1.05%||$566.83||$6,802|
|Protective Level Income 15 (Defer bonus)||A+||1.20%||$556.92||$6,683|
|Protective Level Income Rider||A+||1%||$554.17||$6,650|
|Nationwide Nationwide High Point 365 w/Bonus||A+||1.10%||$540.00||$6,480|
|American National Lifetime Income Rider||A||1%||$530.92||$6,371|
|NWL Income Outlook Plus 5 NH||A||1.50%||$526.50||$6,318|
|Transamerica Income Plus||A||1.15%||$532.50||$6,390|
|NWL Income Outlook Plus 5 Rider||A||1.50%||$526.50||$6,318|
|Symetra Signature Plus GLWB Rider||A||1.25%||$525.92||$6,311|
|Global Atlantic Guaranteed Income Builder Benefit||A||1%||$525.00||$6,300|
|Allianz Index Advantage Income Benefit - Level||A+||0.70%||$520.83||$6,250|
|AIG Lifetime Income Max||A||1%||$513.42||$6,161|
|NWL Income Outlook NH||A||1%||$502.50||$6,030|
|Nationwide New Heights 10 High Point 365||A+||0.95%||$494.00||$5,928|
|Athene Ascent Pro 10 Income Rider - Level||A||1%||$492.75||$5,913|
|AIG Lifetime Income Plus Flex||A||1.10%||$483.75||$5,805|
|Midland Summit Income Strategy Level||A+||1.05%||$489.25||$5,871|
|Athene Ascent Pro 7 Income Rider - Level||A||1%||$486.67||$5,840|
|AIG Power Series Lifetime Income Plus Flex||A||1%||$482.83||$5,794|
|Securian Financial Achiever Lifetime Income Rider||1.15%||$478.33||$5,740|
The below table lists the best fixed index annuity and income rider that provide the most monthly income to a 65-year-old looking to begin income payments immediately.
|GUARANTEED INCOME RIDER FEE INCOME|
|A+ Nationwide (Founded in 1929)|
Bonus Income+ Rider
Annuity: Nationwide Peak 10 (Most States)
|A Symetra Life Insurance Company (Founded in 1957)|
Symetra Income Edge with GLWB Rider
Annuity: Symetra Income Edge
|A+ Protective (Founded in 1907)|
Protective Level Income 15 (Defer bonus)
Annuity: Protective Guaranteed Income Indexed Annuity
|A+ Great American (Founded in 1872)|
Premier Income Bonus GLWB
Annuity: Premier Income Bonus
|A AIG (Founded in 1960)|
Lifetime Income Max
Annuity: Power Index Preferred Plus Income
|A AIG (Founded in 1960)|
Lifetime Income Plus Multiplier Flex
Annuity: Power Index Preferred Plus Income
|A+ Protective (Founded in 1907)|
Protective Level Income Rider
Annuity: Protective Income Builder
When you purchase an index annuity with an income rider you are not annuitizing like an immediate annuity. This means you do not give up control of your asset and have more flexibility should your needs or plans change. All of the numbers provided up until this point are for a deferred annuity with an income rider and have not been annuitization.
Historically, you would have received higher annuity payments by purchasing an income annuity in which you annuitize your money. However, today that is not the case – income riders actually guarantee more income than annuitization and provide greater flexibility. We would not recommend annuitization in most cases but are including the numbers below to give you a good idea of what they would pay should an immediate annuity be a better fit for your situation.
Annuitization: Guaranteed Annuity Payments
The above numbers are based on the highest paying immediate annuity payouts offered from an A+ rated Insurance Company on March 3, 2021. These initial monthly annuity payments are calculated using the single lifetime only income payout option which is something we very rarely would recommend. We’ll explain why momentarily.
Immediate Annuity Payout Options
The below table lists how much a $100,000 single premium immediate annuity pays per month for a 65 year old male, female, and a joint payout for a 65 year old couple with income payments beginning immediately (30 days after the contract is issued).
You’ll notice the monthly income for women is slightly less than it is for a male. This is because women have a longer life expectancy than men so the insurance company assumes they will have to pay females for longer than males.
The joint life option guarantees the income amount for as long as either spouse is alive.
How Much Does a $100,000 Annuity Pay Per Month at 65?
|Lifetime Income Option at 65||Male||Female||Joint|
|Life with Cash Refund||$401||$382||$368|
This next table lists the same single and joint immediate lifetime payout options but for a 60 year old. As you’d expect, the younger you are when you begin taking income the less your monthly payments will be.
How Much Does a $100,000 Annuity Pay Per Month at 60?
|Life with Cash Refund||$367||$351||$338|
Annuity Payout Options Explained
There are different income annuity payout options available to you. We’ve already mentioned a couple of the options in throughout this guide; below is a comprehensive list of all the payout options offered in an income annuity.
- Life Only: payments stop at death (or later of two deaths for joint).
- Joint life only: payments stop at the later of two deaths.
- Life with Cash Refund: optional on life only or joint life only payout that will pay your beneficiaries the difference between the original purchase amount and sum of all payments received upon insured’s death or deaths.
- Life with Period Certain: optional on life only or joint life only payout that guarantees to make payments for at least a certain number of years. Payments will continue to beneficiaries if insured passes away during this period of time.
- Period Certain Only: Will pay you for only a specific number of years; income is not guaranteed for life.
What Factors Impact Your Annuity Payments?
The monthly payment an annuity will pay for the rest of your life is determined by a number of factors, including:
How Are Annuity Payments Taxed?
In general, annuities are taxed using the LIFO (last in first out) method. This means the last money deposited into your annuity will be used by the IRS for tax purposes. What that means to you is any interest or gain you have inside of your annuity will come out prior to your principal so you will be taxed on 100% of all withdrawals until you’ve taken out all of your interest.
One advantage to using an immediate annuity is a large portion of each monthly payment is considered to be your principal that you purchased the annuity with. The amount not taxed is called the exclusion ratio; you can see in the example below that the exclusion ratio is 88.8%. That means only 11.20% of each annuity payment is treated as income and taxed.
Tax Favorable Income Annuity Strategies
If you have an annuity you’ve owned for quite some time you may be reluctant to withdraw your funds because you’ve got a lot of gains built up which are fully taxable at your ordinary income tax rate. A commonly used tax planning strategy is to 1035 Exchange your annuity to an income annuity that will pay you a monthly income for life.
Using this method will the IRS will consider a large portion of each income payment to be your initial deposit and allocate a small percent of your gain. This can be favorable as it will spread your taxes out into smaller chunks over the course of your lifetime.
Frequently Asked Questions
All annuities have the ability to be turned into a guaranteed lifetime income; however, many types of annuities are purchased only for accumulation. Income Annuities are those that are designed specifically to generate a lifetime income stream. The 3 types are:
- Immediate annuity (provides guaranteed, lifelong income starting 1-12 months after purchase)
- Deferred Immediate Annuity (DIA), or Longevity, annuity (provides guaranteed, lifelong income starting 2-40 years after purchase)
- Qualified Longevity Annuity Contract or QLAC (a longevity annuity purchased with IRA funds starting after age 72)
- Deferred annuity with a lifetime income rider
Income annuities do not charge a fee. However, there is a fee to add a guaranteed income rider to a deferred annuity. The fee comes out of your account value and does not reduce your annuity payments.
You can use one of our annuity calculators to get an immediate income annuity quote by visiting our annuity calculators page. We provide links to a few different income annuity calculators but keep in mind these calculators are specific to an individual insurance company and are not necessarily the best available payout. There are intended to provide you a general idea if you want a number immediately.
You can also get a personalized income annuity quote by completeing the annuity quote request form. We will complete all requests within 24 business hours. If your request is of urgent nature you may call us at 855-583-1104 during normal business hours and we’ll run your illustration immediately.