By establishing actuarial model to estimate the internal rate of return of basic endowment insurance for urban and rural residents,this paper finds that the internal rate fluctuates between 8.23% and 79.50%; the internal rate of return with pension adjustment considered is remarkably higher than that unconsidered; the internal rate of return is negatively correlated with the payment grade; the internal rate of return,without regard to pension adjustment,is expected to decrease firstly yet then increase as the payment period extends,while it is negatively correlated with the payment period after taking pension adjustment into account; under the same circumstance of payment grade and payment period,the later the residents are insured,the greater the internal rate of return is.It is suggested that the internal rate of return be scientifically estimated and frankly published; the normal adjustment mechanism of basic pension for urban and rural residents should be established; the policy of differentiated subsidies and the policy of more return for more payment should be implemented; the incentive mechanism of more return from longer payment period should be improved; the timely compulsory insurance should be considered.