Project annuity income in both future dollars and today’s purchasing power. The calculator grows the monthly payment by the assumed contractual increase, reduces it by an effective tax rate, and then discounts the future result by inflation. Seeing nominal and real income together can reveal whether an annuity’s escalation feature is likely to keep pace with planned expenses over the selected horizon.
Future after-tax payment = current payment × (1 + growth)year − 1 × (1 − tax rate)
Real payment = future after-tax payment ÷ (1 + inflation)year − 1
Use the main result as a scenario estimate and compare it with alternative assumptions. Small changes in tax, return, inflation, or payment terms can compound into meaningful differences.
This is an educational estimate, not tax, investment, insurance, or legal advice. Actual taxes and contract benefits depend on jurisdiction and plan terms.
A $2,500 monthly payment growing 2% annually, with 2.5% inflation and an 18% effective tax rate, reaches about $2,986 per month after tax in year 20, worth roughly $1,868 in today's dollars.
Nominal dollars show the payment received; real dollars estimate what that payment may buy after inflation.
Enter 0% annual payment growth.
The model needs one rate applied to the full payment; derive it from the taxable share and marginal rate if needed.
No. It applies the constant inflation assumption you enter.
No. The cumulative figure is nominal after-tax income; only the final monthly purchasing-power figure is inflation-adjusted.
| Output | Dollar basis |
|---|---|
| Final payment | Future nominal after-tax dollars |
| Today's-dollar payment | Inflation-adjusted purchasing power |
| Cumulative income | Nominal after-tax dollars |