What Are Annuities? An annuity is a financial product that provides a series of regular payments in exchange for an initial lump sum or periodic contributions. Annuities are often used as a reliable income stream for retirement, helping to ensure that you don’t outlive your savings. There are several types of annuities, each designed to meet different financial goals. The most common types include:
Fixed Annuities: Provide a guaranteed, predictable income for a set period or for life, offering stability and peace of mind.
Variable Annuities: Payments can vary based on the performance of investments chosen within the annuity, providing the potential for growth but with more risk.
Immediate Annuities: Start paying out immediately after a lump sum is invested, offering an immediate income stream.
Deferred Annuities: Payments begin at a future date, allowing the investment to grow during the accumulation phase.
Annuities can be a powerful tool for retirement planning, helping you manage risk, diversify your income sources, and provide financial security during your retirement years.
