What Is An Annuity?

An annuity is a contract with an insurance company designed to provide guaranteed growth, guaranteed income, or guaranteed principal protection. You deposit money, and in return, the company promises specific benefits you can’t get from banks or the stock market.

 

The Core Idea

Annuities turn savings into predictable, contractually guaranteed outcomes. No guesswork. No market dependence. No “hope it works out.”

 

The Three Main Types

• Fixed Annuities (including MYGAs): Guaranteed interest for a set number of years.
• Fixed Indexed Annuities: Growth linked to an index, but your principal is protected.
• Income Annuities: Turn your savings into a guaranteed monthly paycheck for life.


Why Retirees Use Them

People choose annuities for stability — guaranteed income, protection from market losses, and peace of mind knowing their retirement plan has a foundation that doesn’t depend on Wall Street.