This free fixed index annuity calculator shows the full range of what a fixed index annuity (FIA) could earn — from a market that falls every year to one that beats your cap every year. Enter your deposit, cap rate, and number of years to see how the 0% floor and the cap work together.
See the range of outcomes — from a down market to a great one — with a cap and a 0% floor.
More options (participation & spread)
If the market falls every year
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Your money doesn’t go down
Up-and-down market example
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If the market beats the cap every year
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The most it could be
Account value under three market scenarios
How the up-and-down example works, year by year
| Year | Index change (example) | You’re credited | Account value |
|---|
Caps change often and vary a lot between companies. I’ll show you which California FIAs have the best cap for your term.
Get My Free QuoteFor education only — not a quote, offer, or illustration of any specific annuity. The “up-and-down” market is a made-up example sequence of yearly index changes, not historical data and not a prediction. Assumes annual point-to-point crediting, the same cap every year (real caps can change at each renewal), no withdrawals, and no rider fees. Guarantees depend on the issuing insurance company’s claims-paying ability. Kevin Edwards, Integrity Now Insurance Brokers, CA License #0D42517.
How to use the fixed index annuity calculator
- Enter how much you’d put in. Most fixed index annuities start at $10,000 to $25,000.
- Enter the cap rate. The cap is the most your account can be credited in one year. Compare real caps on our weekly California fixed index annuity rates page.
- Pick the number of years. This usually matches the annuity’s surrender period, such as 5, 7, or 10 years.
- (Optional) Adjust participation and spread. If your strategy credits only part of the index gain or subtracts a spread, open “More options.”
Instead of guessing one return, the calculator shows three scenarios side by side so you can see the floor, the ceiling, and an example in between. Open the year-by-year table to see exactly how each year’s index change turns into your credited interest.
How a fixed index annuity earns interest
A fixed index annuity is a fixed annuity whose interest is linked to a stock market index such as the S&P 500®. Your money isn’t invested in the market. Instead, once a year the insurance company looks at how much the index changed and credits interest based on three rules:
- The floor (0%). If the index goes down, you’re credited 0% for that year. You don’t lose money because of the market.
- The cap. If the index goes up more than the cap, you get the cap. For example, with a 9% cap, a 21% index gain earns 9%.
- Participation rate and spread. Some strategies credit only a percentage of the gain (participation) or subtract a set amount (spread) before the cap applies.
The calculator uses the most common method, called annual point-to-point: each year’s credit is based on the index value at the start and end of that contract year. Credited interest is locked in and becomes part of your protected balance.
Why the calculator shows a range instead of one number
No one knows what the market will do. Showing a single “expected” return can make a fixed index annuity look more certain than it is. The three scenarios give you the honest boundaries: the worst case is that you keep your full deposit (before any rider fees or early withdrawals), and the best case is earning the cap every year. The “up-and-down” line is a made-up example sequence of good and bad years — not historical data and not a prediction — to show how the floor and cap work in practice.
Fixed index annuity vs. fixed annuity
| Fixed index annuity | Fixed annuity (MYGA) | |
|---|---|---|
| Interest | Varies with an index, between 0% and the cap | One guaranteed rate for the term |
| Market losses | None — down years earn 0% | None |
| Upside | Higher in strong market years, limited by the cap | Known in advance |
| Rates after year one | Caps can change at each renewal, down to a guaranteed minimum | Locked for the full term |
| Best for | Savers who want some market-linked growth with no downside | Savers who want a guaranteed result |
If you’d rather know your exact result on day one, try our fixed annuity calculator and compare.
Things the calculator can’t show
- Cap changes. The calculator holds your cap steady. Real caps are usually guaranteed for one year, then reset. Look for a product with a solid guaranteed minimum cap.
- Rider fees. Optional income or death benefit riders often charge an annual fee that can reduce your account value, even in 0% years.
- Surrender charges. Taking out more than the free withdrawal amount (often 10% a year) during the surrender period usually costs a surrender charge.
- Other crediting strategies. Many FIAs offer volatility-controlled indexes, multi-year terms, and fixed accounts. Those can’t be compared in a simple calculator.
Fixed index annuity calculator FAQs
Can I lose money in a fixed index annuity?
Not because of a market drop — down years are credited 0%. You can lose money by surrendering early (surrender charges) or through optional rider fees, which is why it’s important to understand the contract before you buy.
What is a good cap rate?
It depends on the surrender period and current interest rates. Longer surrender periods usually offer higher caps. See today’s best S&P 500 caps by term on our California index annuity rates page.
Does the calculator use real S&P 500 returns?
No. The up-and-down example is a made-up sequence designed to show how the floor and cap work. Past index performance doesn’t predict future credited interest.
Are dividends included?
No. Most fixed index annuities track a price index, which doesn’t include dividends. That’s one reason credited interest is usually lower than the index’s total return in strong years.
Is the interest taxed each year?
No. Like other annuities, growth is tax-deferred until you withdraw it. Withdrawals of earnings are taxed as ordinary income, and taking earnings before age 59½ may add a 10% IRS penalty.
Compare real fixed index annuity caps
Caps vary widely between insurance companies and change often. I’m Kevin Edwards, an independent California-licensed annuity agent. I’ll show you which fixed index annuities offer the best caps — and the best guaranteed minimums — for your term. Request a free fixed index annuity quote or call (877) 854-7396.
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