An annuity is a financial product that provides a regular income stream to the annuitant over a specific period or for the rest of their life. An annuity can be purchased from an insurance company, and the annuitant makes a lump sum payment or a series of payments into the annuity. The insurance company invests the money and makes regular payments to the annuitant according to the terms of the annuity contract.

An annuity can provide a reliable source of income during retirement or after a specific period of time. It is often used as a tool to manage longevity risk, as it guarantees a stream of payments for the rest of the annuitant's life.

There are various types of annuities, including fixed, variable, indexed, and immediate annuities. Each type has its own features, benefits, and risks, and it is essential to consider these factors carefully before deciding on the best annuity for your needs.

An annuity is a financial product designed to provide a steady stream of income, typically for retirement. It is offered by insurance companies and requires an individual to make either a lump-sum payment or a series of payments. In return, the annuity pays out regular amounts over a specified period or for the rest of the individual’s life.

There are two main types: fixed annuities, which offer predictable, guaranteed payments, and variable annuities, where payouts fluctuate based on investment performance. Some annuities also include benefits like death payouts to beneficiaries.

Annuities are useful for managing longevity risk, ensuring retirees don’t outlive their savings. However, they may involve fees, limited liquidity, and surrender charges, making careful consideration essential.