Pension Calculator
Lump-sum vs monthly pension comparison.
Inputs
$
$
%
yrs
Result
PV of Monthly Pension$307,908.08
Lump Sum$300,000.00
Better OptionMonthly Pension
About the Pension Calculator
The Pension Calculator estimates your annual pension income based on years of service, final average salary, and the plan's benefit multiplier.
Calculation method
Most defined-benefit plans use: Annual pension = Years of service × Multiplier × Final average salary.
Pension = Years × Multiplier% × SalaryHow to use this calculator
- Enter your final average salary.
- Enter your years of service at retirement.
- Enter the plan's benefit multiplier (usually 1–2.5%).
Example
30 years of service, 2% multiplier, $85,000 final salary yields a $51,000 annual pension.
Frequently asked questions
What is a benefit multiplier?
The percentage of salary earned per year of service. Public sector plans often use 2–2.5%; private plans typically use 1–1.5%.
Is my pension inflation-adjusted?
Some plans (especially government) include cost-of-living adjustments (COLAs). Most private-sector pensions are flat.
Should I take lump sum or monthly annuity?
The annuity provides guaranteed lifetime income. A lump sum offers flexibility and inheritance potential but shifts investment and longevity risk to you.
Disclaimer: This calculator is for informational and educational purposes only and does not constitute financial, tax, or legal advice. Consult a qualified professional for decisions specific to your situation.