Annuities are financial contracts issued by insurance companies that provide a guaranteed stream of income, typically for retirement. In exchange for a lump sum or series of payments, the insurer agrees to make periodic payouts—either immediately or at a future date—helping protect against the risk of outliving your savings.

They come in various forms:

• Fixed Annuities: Offer predictable, stable payments.
• Variable Annuities: Payments fluctuate based on market performance.
• Indexed Annuities: Returns are tied to a market index, like the S&P 500.
• Immediate vs. Deferred: Immediate annuities start paying right away; deferred ones grow over time before payouts begin.

Annuities can also offer tax-deferred growth and optional riders for benefits like long-term care or legacy planning.