What does SPIA stand for?

SPIA stands for Single Premium Immediate Annuity. You pay an insurance company one lump-sum premium, and in return the company pays you a guaranteed income — usually monthly — beginning within 30 days to 12 months of purchase, most commonly for the rest of your life.

How much does a SPIA pay per month?

As of July 2026, a $100,000 SPIA with a life-only payout pays a 65-year-old man up to $664 per month, a 65-year-old woman up to $635, and a 65-year-old couple up to $583 with a 100% survivor benefit. Payouts rise with age: the same $100,000 pays a man up to $754/month at 70 and $882/month at 75.

What is the downside of a SPIA?

The main trade-offs are liquidity and inflation. Once you annuitize, the premium is committed — you generally cannot withdraw the lump sum back. And a fixed payment loses purchasing power over time unless you add an inflation or COLA rider, which lowers the starting payment. Life-only contracts also stop at death, which is why many buyers add a period-certain or cash-refund feature to protect heirs.

Is a SPIA a good investment?

A SPIA is not really an investment — it is insurance against outliving your money. It converts savings into a guaranteed lifetime paycheck with zero market risk. Retirement researchers generally recommend using a SPIA to cover essential expenses that Social Security does not, while keeping the rest of a portfolio invested for growth.

SPIA guarantees are backed by the claims-paying ability of the issuing insurance company, which is why carrier financial strength ratings (A, A+, A++) matter. As an additional backstop, every state runs a guaranty association that protects annuity benefits if an insurer fails — typically up to $250,000 of present value per owner, per company.

What Is a SPIA? Single Premium Immediate Annuities Explained

A SPIA (single premium immediate annuity) is an insurance contract that converts a one-time lump sum into guaranteed income — usually monthly, usually for life — starting within 30 days of purchase. As of July 2026, a $100,000 SPIA pays a 65-year-old man up to $664 per month for life.

If you have ever wished you could trade a chunk of your retirement savings for a pension — a real one, that shows up every month for the rest of your life — this is that product. The SPIA is the oldest, simplest, and most transparent annuity you can buy, and it is the product this entire site is built around.

SPIA Definition: The 30-Second Version

A SPIA is a contract with an insurance company with exactly three moving parts:

Single premium — you pay once, as a lump sum. No ongoing contributions.
Immediate — income begins right away, usually within 30 days (and no later than 12 months).
Annuity — the company pays you a fixed amount on schedule, most commonly for as long as you live.

That's the whole product. No market exposure, no annual statements to decode, no fees skimmed off a cash value — the payment quoted is the payment you get. The insurance company pools thousands of buyers, invests the premiums in bonds, and uses actuarial math to guarantee every member of the pool an income they cannot outlive.

What a SPIA Pays Right Now (July 2026)

Payouts change with interest rates and your age at purchase. As of July 2026, a $100,000 premium with a life-only payout buys, at best quote among the 8 A-rated carriers we track:

$664/month for a 65-year-old man ($7,968/year)
$635/month for a 65-year-old woman
$583/month for a 65-year-old couple with 100% survivor benefit
$754/month for a man waiting until 70 — payouts rise every year you defer

Larger premiums scale proportionally — see exactly what $300,000 or $500,000 pays per month, or check the full current rate tables. Payout rates in mid-2026 are near their highest levels in over a decade, which has made SPIAs dramatically more attractive than they were in the low-rate 2010s.

Why Payout Rates Beat Interest Rates

A common confusion: a 65-year-old man receiving $664/month on $100,000 is getting a payout rate of about 8.0% — much higher than any bond yield. That's because each payment is part interest, part return of your own principal, and part mortality credits: the actuarial dividend that comes from pooling longevity risk with other buyers. Mortality credits are the reason no do-it-yourself bond ladder can safely match a SPIA's lifetime income — an insurer can promise payments to age 100+ because not everyone in the pool will get there.

SPIA Payout Options

The biggest decision after "how much" is the payout structure:

Life only — highest monthly payment; payments stop at death. Best when maximizing income is the priority and heirs are provided for elsewhere.
Life with period certain — payments for life, but guaranteed for at least 10 or 20 years. If you die in year 4 of a 10-year certain, your beneficiary collects the remaining 6 years.
Cash refund — if you die before receiving your full premium back, your beneficiary receives the difference as a lump sum.
Joint and survivor — payments continue for two lives, at 100%, 75%, or 50% of the original amount after the first death.

Each protection feature trades a little monthly income for certainty. We break down the real cost of each in our payout options guide.

SPIA vs. Other Annuities

The word "annuity" covers products that have almost nothing in common. Where the SPIA sits:

SPIA vs. deferred income annuity (DIA): identical concept, but a DIA starts paying years later — buy at 65, income at 75. Deferring buys a much higher payment.
SPIA vs. fixed deferred annuity (MYGA): a MYGA is a CD-like savings vehicle earning a fixed rate; it doesn't produce lifetime income unless you later annuitize it.
SPIA vs. variable/indexed annuities: these are accumulation products with market exposure and, often, the high fees that give annuities a bad name. A SPIA has no ongoing fees at all — pricing is built into the quoted payment.

Full comparison in Types of Annuities Explained.

How SPIAs Are Taxed

It depends on the money you buy with. Purchase with after-tax savings (non-qualified) and the IRS treats most of each payment as a tax-free return of your own principal under the exclusion ratio — often 50–65% of each check. Purchase with IRA or 401(k) money (qualified) and payments are fully taxable as ordinary income, just as withdrawals would have been — and the SPIA payments automatically satisfy required minimum distributions on that money. State treatment varies; nine states tax no income at all. Details in How Are Annuities Taxed? and our state-by-state guides.

The Honest Downsides

A SPIA is irreversible: once income starts, you generally cannot get the lump sum back, so never annuitize money you may need for emergencies. Fixed payments also lose purchasing power to inflation — a COLA rider fixes that at the cost of a lower starting payment. And a life-only contract can pay "less than you put in" if you die early, which is exactly the risk the period-certain and cash-refund options exist to remove. Weigh both sides in Pros and Cons of Annuities.

Who Should Buy a SPIA?

The strongest fit is a retiree between roughly 60 and 80 who wants essential expenses guaranteed regardless of markets: cover the gap between Social Security and your actual fixed costs, and invest the rest for growth. It is equally sensible for someone whose employer offered a lump-sum pension buyout and wants to rebuild that pension privately — often at a better rate than the employer's annuity.

How to Buy a SPIA (The Right Way)

Decide the income gap you need to cover, and work backwards to the premium — our calculator does this in seconds.
Choose your payout option — life only, period certain, cash refund, or joint.
Compare quotes across carriers. On identical contracts, quotes currently spread 5–6% across A-rated insurers. This is the single highest-value step.
Check financial strength and your state guaranty limit — stay with A-rated carriers, and split large premiums across insurers if needed.
Lock the quote. SPIA quotes are typically valid 7–14 days; rates move monthly.

Ready to see your number? Get a free personalized SPIA quote — no obligation, all 8 carriers compared at once.