annuity

You’re saving to build a nest egg for retirement. But once you stop working, how will you get a regular income to live on? Annuities are a retirement vehicle that can help provide a steady, guaranteed stream of income in retirement. And, you can contribute to an annuity as part of your retirement strategy alongside any contributions you make to a 401(k) or an IRA.

There are several types of annuities, and many provide tax-deferred growth. How do you want your money to be invested? When do you need to start receiving income? Different annuities are designed to meet different needs.

• Immediate annuities
  Most annuities are "deferred" — you invest for a number of years and then take income later. An immediate annuity is a type of income annuity designed to start payments right away, typically within a year of your lump-sum investment. Immediate annuities can be customized to provide income for a set period or for life, offering reliable income streams and financial security during retirement.
• Fixed deferred annuities
  A fixed annuity is a long-term retirement investment for people who want predictability. You’ll receive a guaranteed rate of return on the premium you contribute. And, when you’re ready to retire, you can receive guaranteed income payments.
• Fixed index annuities
  This annuity can provide both premium protection and growth potential, allowing you to benefit when the market performs well and a level of protection when it does not. They provide a minimum guaranteed interest rate combined with potential growth tied to a specific index.
• Registered index-linked annuities
  A registered index-linked annuity (RILA) allows you to take advantage of potential growth tied to the performance of a stock market index, while also limiting losses during a market downturn.
• Variable annuities  If you want to invest your money over the long term and take advantage of potential growth of the financial market.

• * They also provide the opportunity for you to earn tax-deferred savings until you're ready to receive guaranteed income payments