Pension Calculator
Compare pension payment options and retirement timing.
Compare the discounted pension stream to a lump sum.
Result
How to use this calculator
Compare the discounted pension stream to a lump sum. Enter amounts in the units shown, select the applicable options, and click Calculate. Use Reset to restore the starting values.
Calculation formula
Pension value = present value of monthly pension benefits, adjusted for COLA.
Assumptions and accuracy
Review timing, rates, fees and result notes when comparing scenarios. Future returns and rates are assumptions rather than guaranteed outcomes. Monetary display follows the currency’s precision; intermediate calculations retain additional digits.
Choose what to calculate
Lump sum vs monthly pension calculator
Compare the discounted value of a lump sum and pension payments over an entered lifespan. This deterministic comparison excludes actuarial mortality probabilities.
Related searches: Lump sum vs pension calculator
Open this calculationUnderstanding this calculation
Compare a pension stream with a lump sum, survivor option or alternative retirement start. The discount rate and assumed lifespan determine how future payments are valued.
Worked examples
Value one year of pension payments at a zero discount rate
Illustrative inputs are specified in the steps below; the example link loads the complete settings. Unmentioned settings use the linked defaults.
- Twelve monthly benefits of 1,000 sum to 12,000. At zero return with no COLA, discounting leaves that same value.
Present value of pension: 12,000 USD.
Try these inputsCommon questions
How should I compare a pension with a lump sum?
Compare cash-flow timing and present value under explicit return and longevity assumptions, then consider risk and flexibility separately.
Does a survivor pension always have a higher value?
Not necessarily. It trades a lower initial payment against possible benefits after the member's assumed death; partner lifespan and survivor percentage matter.
Scope and assumptions
Life expectancy is an assumption, not a mortality-weighted guarantee. Taxes, plan credit risk and individual plan provisions are not fully modeled.
Sources
- Calculation methodology, rule versions and testing limitations
- Reference calculator for feature comparison (not a model-parity certification)
Calculation notes checked . Examples are mathematical checks under the stated assumptions.
Calculation methods and formulas
Lump Sum vs. Monthly Pension
Compare the discounted pension stream to a lump sum.
Pension value = present value of monthly pension benefits, adjusted for COLA.
Single Life vs. Joint Survivor
Compare household pension benefits through the entered lifespans.
Discount single-life benefits, joint benefits during your life, and the survivor benefit thereafter.
Work Longer
Compare pension streams starting at two retirement ages.
Discount each benefit stream to the earlier retirement age.
See our calculation methodology and review status for data versions, rounding and validation limitations.