Compare a monthly pension against a lump sum offer.
How to use this calculator
Every field updates the result as you type — there is no submit step. The inputs below are pre-filled with a realistic example so you can see how the tool behaves before entering your own figures.
| Field | Unit | What it means |
|---|---|---|
| Monthly pension offered | $ | Enter a numeric value. |
| Lump sum offered | $ | Enter a numeric value. |
| Years you expect to collect | — | Enter a numeric value. |
| Return if you invest the lump sum | %/yr | Enter a numeric value. |
| Pension cost-of-living increase | %/yr | Enter a numeric value. |
Worked example
Using the default values loaded into the calculator above, the result is:
| Input | Value |
|---|---|
| Monthly pension offered ($) | 2500 |
| Lump sum offered ($) | 420000 |
| Years you expect to collect | 25 |
| Return if you invest the lump sum (%/yr) | 5 |
| Pension cost-of-living increase (%/yr) | 0 |
| Output | Value |
|---|---|
| Pension is worth more by | $7,650.12 |
| Present value of pension | $427,650.12 |
| Lump sum offered | $420,000.00 |
| Monthly income the lump sum could buy | $2,455.28 |
| Total nominal pension payments | $750,000.00 |
| Break-even discount rate | 5.182% |
Reading the result
Financial projections compound small assumption changes into large differences over time. Rates, fees and tax treatment vary by lender and jurisdiction, so treat the output as a well-structured estimate for comparing options rather than a quotation.
Figures that change annually — tax bands, contribution limits, statutory rates — are exposed as editable inputs. Check them against current published values before relying on the result.
Sharing and saving a calculation
The "Copy link" button encodes every value you have entered into the page URL. Opening that link restores the calculation exactly, which makes it easy to bookmark a scenario, send it to someone else, or keep several variations side by side in separate tabs.
Frequently asked questions
What does the Pension Calculator do?
Compare a monthly pension against a lump sum offer.
What result do the default values produce?
With the values pre-loaded in the calculator, pension is worth more by comes to $7,650.12.
Is this calculator free to use?
Yes. It is free, requires no account, and runs entirely in your browser — nothing you enter is transmitted or stored on a server.
Can I save or share a calculation?
Yes. The "Copy link" button builds a URL containing all your entered values. Anyone opening that link sees the same calculation.
How accurate is the result?
The calculation itself is exact for the inputs given. Real-world accuracy depends on how well those inputs reflect your actual situation, so review the assumptions before relying on the figure.