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How much would a $400,000 annuity pay monthly if bought at 70?

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Before purchasing a $400,000 annuity, it's important to have a clear idea of what your monthly payments could be. Getty Images

It's mid-2025, and there are a lot of uncertainties looming in today's economic landscape, from inflation to stock market volatility and questions about the sustainability of the Social Security program. As a result, many retirees are looking for ways to add stability to their retirement plans via guaranteed income options that aren't tied to the stock market. And, one way to do that is through an annuity, which is an insurance product that helps bridge the gap between retirees' savings and their monthly expenses.

The appeal of an annuity is straightforward: With this type of retirement tool, you convert a lump sum into guaranteed monthly income that lasts as long as you live. And, with interest rates still relatively high now, annuities are even more attractive. Elevated rates mean stronger payouts for new buyers, especially those purchasing immediate annuities that start paying right away. So, for retirees in their 70s who want to lock in income without the stress of managing investments, this could be a prime opportunity.

But just how much income can you expect from an annuity? Let's break down what a $400,000 annuity could pay monthly if you buy one at age 70 — and what factors could cause your check to be bigger or smaller.

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How much will a $400,000 annuity pay monthly if bought at age 70?

The monthly payout from a $400,000 immediate annuity purchased at age 70 varies significantly based on several key factors, with your gender being one of the most impactful. Here's what a single premium immediate annuity purchased at age 70 today could pay each month, based on by Annuity.org:

  • Male, age 70: around $2,923 per month
  • Female, age 70: around $2,763 per month
  • Joint life (both spouses age 70): around $2,449 per month

Here's why each figure differs — and why the numbers could look different depending on your personal situation:

Gender and life expectancy

Women statistically live longer than men, so annuity companies pay them a slightly lower monthly amount for the same premium because the payments are likely to stretch over additional years. 

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Single vs. joint life annuity

Single life annuities pay out until the original annuitant passes away. Joint life annuities, on the other hand, continue payments to a surviving spouse (or designated beneficiary) after one partner dies. Because of that added longevity protection, monthly checks are lower, though they continue as long as at least one person is alive.

Interest rate environment

Annuity payouts are deeply influenced by current interest rates because the money you hand over is invested by the insurer in bonds and other fixed-income securities. Today's elevated interest rates generally translate into stronger payouts for new annuities. If rates tighten further or come down, though, the payouts on future annuity purchases could be less generous.

Type of annuity

Not all annuities are created equal. A fixed immediate annuity, which the above estimates assume, delivers a guaranteed monthly check for life but doesn't account for inflation. Inflation‑adjusted annuities keep pace with the Consumer Price Index but start at a lower initial payout for the same premium. Then there are variable immediate annuities, where your payout fluctuates based on how the underlying investments perform — which is riskier, but with upside potential.

Optional riders and guarantees

Want the option to pass a death benefit to heirs? Or a cost of living rider? Something that guarantees a minimum payment even if the annuity's underlying investments stumble? Those extra features, or "riders," will reduce your monthly income because the insurer is assuming more risk. In contrast, a straight, no-frills life annuity yields the highest payout for the money.

How to get the highest monthly payout from your annuity

If your goal is to maximize the monthly income from your $400,000 annuity, there are a few strategic decisions that can make a big difference, including:

Opt for a single-life annuity

If you don't need to provide for a spouse or dependents after your death, this option offers the most value. Adding joint coverage or death benefits can give you peace of mind, but it will reduce your monthly check.

Lock in when interest rates are favorable

Buying when rates are elevated can lock in stronger payments for life. If rates drop in the future, new buyers could see smaller monthly checks for the same premium. If you're unsure about the direction of rates, a split annuity strategy (buying in phases) could help you hedge your timing.

Skip the optional riders

While tempting, add-ons like inflation adjustments, period certain guarantees, and death benefits often reduce your monthly income substantially. If you're focused strictly on maximizing income, it's often best to go with the most basic version of an immediate annuity, which is just pure monthly income for life.

The bottom line

A $400,000 annuity purchased at age 70 can provide meaningful monthly income ranging from approximately $2,400 to $2,900, depending on your specific circumstances and the options you choose. But while this guaranteed income stream provides valuable protection against market volatility and the possibility of outliving your savings, the reality is that annuities aren't right for everyone. Once you purchase an immediate annuity, your $400,000 is no longer accessible as a lump sum, and you can't change your mind if your circumstances shift. So, make sure to do your homework, weigh the benefits and possible downsides and ensure an annuity makes sense for your retirement portfolio before buying in.

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