Pension Calculator 2026
Calculate your defined benefit pension monthly income. Compare single-life vs joint-and-survivor options, and monthly income vs lump sum.
Pension Benefit Formula
Annual pension = Final average salary × Years of service × Benefit multiplier
On a 2% multiplier: 30 years of service = 60% income replacement. 40 years = 80% replacement. Most financial planners target 70%–80% income replacement in retirement (from pension + Social Security combined).
Single Life vs Survivor Benefits
A single-life annuity pays the highest monthly amount but stops at death — your spouse receives nothing. A joint-and-survivor annuity reduces your monthly payment by 5%–20% but continues paying your spouse (at 50%–100% of your benefit) after you die. If your spouse is significantly younger or in poor health, the single-life option may make more financial sense.
Lump Sum vs Monthly Payments
The lump sum is typically valued at 15–20× the annual benefit. At 15× and a $45,000/year pension, the lump sum equivalent is $675,000. If you can invest that sum and earn 6%+ consistently, the lump sum may be better. Most people benefit more from the guaranteed monthly income — especially as a complement to Social Security.