Annuity

What is an annuity?

An annuity is simply an insurance contract that states an insurer will pay funds to the beneficiary as a lump-sum or as a series of payments, in exchange for the contract holder’s premium, which they may pay as a lump sum or as a series of payments. Depending on the terms, the income stream can be specified to last the rest of the purchaser’s lifetime, or longer. If this seems like a very vague definition, that’s because it is.