Annuity Terms

An immediate annuity payment term where income payments are made by the insurance company for a predetermined set period of time only.

Annuity terms. What is an Annuity. Purchase payments Money paid into a contract. Annuity A periodic income payable for the lifetime of one or more persons or for a specified period.

The simplest form of an annuity a fixed annuity guarantees a stream of fixed payments over a certain period of time andor a persons lifetime. The resulting gain to the investor would be 4. An annuity is a financial product that provides certain cash flows Cash Flow Cash Flow CF is the increase or decrease in the amount of money a business institution or individual has.

Annuities are insurance contracts that promise to pay you regular income immediately or in the futurethe latter is known as a deferred annuity. A type of deferred annuity that pays a fixed rate of interest. An annuity that is purchased with a single lump-sum payment instead of a series of payments.

For example if the SP 500 increases by 6 and the spread are 2. Amount deducted before an insurance company credits annuity gains. A 10-year term certain annuity payout means that payments are guaranteed to be made for at least 10 years.

However each type of annuity has advantages and drawbacks that should be considered carefully before purchase. The glossary includes annuity terms as well as common investment and financial terms in alphabetical order with clear easy-to-understand definitions. The maximum amount an investor can earn annually.

After the initial 10 years payments stop. Your annuity rate is the percentage by which your annuity grows each year. You can buy an annuity with a lump sum or a series.