Annuities

What is an annuity?

An annuity is a financial vehicle that lets you put money away so you can have a guaranteed, regular "paycheck" for the rest of your life. Annuities grow tax-deferred until they start paying you an income. You contribute to an annuity — either as a lump sum, or in several payments over time — to get regular payments in the future, and for the rest of your life. As a tradeoff, annuities come with less liquidity than other financial products.

Who are annuities for?

Annuities can be great for someone wanting to supplement or fund his or her retirement savings with an income stream that is guaranteed to last their lifetime.

How can an annuity fit into your plan?

Retirement plans used to rely on pensions and social security. These days, with pensions no longer common and questions around the future of social security, an annuity can provide a guaranteed source of income in retirement.

A special feature of many annuities is that the income is guaranteed for life and cannot be outlived. They can cover gaps in your retirement income and give you the confidence to know that you're more likely to stay financially independent in retirement and won't become a burden to the people you love.

There are many annuities to choose from depending on your goals, time frame, risk tolerance, and family situation. Annuities can be either immediate or deferred.