An annuity is a contract with an insurance company that provides guaranteed income for life or a specific period. Unlike traditional investments, annuities offer tax-deferred growth and financial security, making them ideal for retirees.
Types of Annuities
Fixed Annuities: Provide guaranteed, predictable payments.
Variable Annuities: Payments fluctuate based on market performance.
Indexed Annuities: Earnings are tied to a market index like the S&P 500.
Benefits of Annuities for Retirement
Guaranteed Lifetime Income – Never outlive your savings.
Tax-Deferred Growth – Pay taxes only when you withdraw.
Inflation Protection – Some annuities offer rising payouts.
No Market Risk (Fixed Annuities) – Your principal is protected.