Pension vs. Lump Sum Payout Calculator
Use this calculator to compare the results of getting a lump sum payout instead of a guaranteed monthly pension for life. Find out what the required annual rate of return required would be for your pension plan options. Choose from pensions that are for a single life, Joint and survivor or a life with 10 years certain.
Pension vs. Lump Sum Payout Calculator Definitions
- Pension type
- The type of monthly pension to compare. Your choices are as follows:
Pension Payment Types Single life Monthly pension payments guaranteed for life the pensioner. 50% Joint and Survivor Monthly pension payments guaranteed for life the pensioner, plus 50% of the monthly pension benefit for the remaining life of the surviving spouse. 100% Joint and Survivor Monthly pension payments guaranteed for life the pensioner, plus 100% of the monthly pension benefit for the remaining life of the surviving spouse. Life with 10 Years Certain Monthly pension payments guaranteed 10 years or the life the pensioner - whichever is longer.
- Monthly pension
- The monthly pension paid though the life of the pensioner. Any spousal pension amount is calculated based on amount entered here.
- Lump Sum pension payout
- The lump sum that you would receive instead of guaranteed monthly pension payments.
- Age to receive lump sum payout
- This is the age you would receive the lump sum payout.
- Current age
- This is the current age of the pensioner.
- Age pension begins
- Age pension begins for the recipient.
- Age of death
- The age of death is when the primary pensioner dies and any non-spouse pension payments would end.
- Spouse's age
- Current age of spouse. This is only used for Joint and Survivor pension types.
- Spouse's survivors pension
- This is only used for Joint and Survivor pension types. The survivors pension is a calculated amount depending on the type of pension that is chosen.
- Spouse's age of death
- This is the age the spouse dies and any survivors pension would end.
- Required rate of return
- This is the annual rate of return that would be required on the lump sum amount to match the guaranteed monthly pension payments.
- Total pension benefit payments
- Total pension payments for the type of pension selected, assuming the pensioner and if applicable their spouse, live to the age(s) entered.