As more and more people are entering the retirement phase, saving for retirement has become more important than ever. A pension annuity calculator is a valuable tool that helps one plan for income in retirement. It is an indicator of the amount of money one will receive in payment over a period. Options are provided to choose payments annually or per month. The inflation rate is also taken in to account to provide an idea of what the annuity payout will be worth over time.

For a person who is retired or semi-retired, having a steady flow of income is a relief in old age. In fact, annuities are not the only way to plan for retirement anymore. It pays to shop around for annuity before deciding. Some quick facts on annuity and pension annuity calculator that will come in handy:

• Annuities being a safer bet for retirement planning, buy an annuity when you start your retirement, irrespective of what age. The earlier you retire, the longer the money has to last. This is one of the reasons many Americans choose to be semi-retired in their golden years.
• While calculating your prospective retirement income, external factors such as interest rates on the investments play a role.
• Health and lifestyle are also determining factors of your retirement income.
• It is not necessary to take the annuity offered by your pension provider, compare the rates provided by different companies before choosing the one best suited for your needs.
• The pension annuity calculator is meant for the accumulation phase of the annuity. It shows the growth of the annuity based on regular deposits.
• The investments are chosen at the time of purchase (fixed investments or variable investments) and are tax deferred.
• Before purchase, find out if the payout options are friendly and also if there’s a penalty for withdrawal.
• Adjust the calculation if your annuity does not begin the payout for many years.

The best annuity is one that provides you with regular retirement income for life.