Online fixed annuity growth calculator to project contract and surrender value or the initial deposit needed from rates, fees, contributions, and term.
Fixed Annuity Growth Formula
This calculator models annual crediting followed by an annual asset-based fee. The effective annual growth factor is:
g = (1 + r) * (1 - f)
With an initial deposit and end-of-year contributions, the ending value is:
For whole n: FV = PV * g^n + PMT * (g^n - 1) / (g - 1) When g = 1: contribution value = PMT * n For fractional n: m = floor(n), u = n - m Contribution value = PMT * g^u * (g^m - 1) / (g - 1) When g = 1: contribution value = PMT * m
The estimated surrender value applies the selected surrender charge to the ending value:
Surrender Value = FV * (1 - s)
Variables:
- g is the net annual growth factor after the modeled annual fee
- r is the annual credited rate as a decimal
- f is the annual fee rate as a decimal
- PV is the initial deposit
- PMT is the annual end-of-year contribution
- n is the term in years; only m = floor(n) completed year-end contributions are counted, with a geometric growth factor for the remaining fraction
- s is the surrender-charge rate at the end of the term
The fractional-year factor is a mathematical modeling convention, not a contract promise. The inverse uses max(0, [target − contribution future value]/g^n); when contributions already exceed the target, actual projected value and surplus are reported. A contract may restrict additional premiums, reset crediting rates, credit interest more frequently, impose flat fees, apply free-withdrawal allowances or a market-value adjustment. Taxes, inflation, tax penalties and annuitized income are excluded. Use the insurer’s guaranteed and current schedules when available. SEC Investor.gov annuity overview and NAIC fixed deferred annuity buyer guide explain contract-specific fees, surrender conditions and guarantees.
Fixed Annuity Growth Reference
These values show how a $100,000 deposit grows with no additional contributions or surrender charge.
| Net annual growth | 5 years | 10 years | 15 years |
|---|---|---|---|
| 2% | $110,408 | $121,899 | $134,587 |
| 3% | $115,927 | $134,392 | $155,797 |
| 4% | $121,665 | $148,024 | $180,094 |
| 5% | $127,628 | $162,889 | $207,893 |
Example Problems
Example 1: Project the ending value.
A $100,000 fixed annuity credits 4.5% annually, charges a 0.5% annual asset-based fee, and is held for 10 years.
The modeled net factor is 1.039775. With no additional contributions, the ending contract value is $147,704.49 before any surrender charge.
Example 2: Account for a surrender charge on a separate hypothetical value.
If the contract value is $147,700 and a 3% surrender charge still applies, the estimated amount available is $143,269.
The $4,431 difference is the modeled surrender charge.
Frequently Asked Questions
Is a fixed annuity rate guaranteed for the full term?
Some contracts guarantee a rate for a stated period, while others can reset subject to a minimum guarantee. Enter the rate you want to model and compare it with the contract’s guaranteed schedule.
What fees should I enter?
Enter an annual percentage fee only when the contract or rider charges one against account value. Many simple fixed annuities do not have an asset-based fee but can have surrender charges.
Why can the surrender value be lower than the contract value?
A surrender charge reduces the amount available when money is withdrawn during the surrender period. Some contracts can also apply a market-value adjustment that is not included here.
