What Are Annuities?

What Are Annuities — and How Can They Protect Your Retirement?

Understanding Annuities

When planning for retirement, one of the biggest concerns people have is running out of money.
Annuities are designed to help prevent that — providing guaranteed income for life so you can retire with confidence and peace of mind.

In simple terms: An annuity is a financial contract with an insurance company that helps you turn your savings into a steady income stream for the future.

How Annuities Work

An annuity is an agreement between you and an insurance company.
You pay a lump sum or make payments over time, and in return, the company promises to send you regular income payments either immediately or in the future.

There are several types of annuities:

• Fixed Annuities: Offer guaranteed interest and predictable payments.

• Indexed Annuities: Let your earnings grow based on a market index (like the S&P 500) with downside protection.

• Variable Annuities: Invest in market subaccounts for potentially higher returns, but with more risk.

Regardless of the type, annuities are built to provide stability and security during retirement.

Who Can Benefit from an Annuity?

1. Pre-Retirees and Retirees Seeking Stable Income

If you’re nearing retirement and want to supplement your Social Security or pension, an annuity can guarantee monthly income you can’t outlive.

2. Individuals Worried About Market Volatility

Fixed and indexed annuities protect your principal from market downturns, making them ideal for conservative investors who still want growth potential.

3. Professionals with Lump-Sum Savings

If you’ve accumulated savings from a 401(k), IRA, or business sale, you can use an annuity to convert that lump sum into lifetime income.

4. Families Focused on Legacy Planning

Some annuities include death benefit riders, ensuring your remaining balance goes to your loved ones if you pass away early in the payout phase.

An annuity is like your personal pension — a reliable paycheck you can’t outlive.

Why It Matters

Retirement should be about peace of mind, not financial worry.
Annuities give you predictable, guaranteed income so you can focus on what truly matters — enjoying life with the people you love.

Whether you’re looking to secure income, protect your savings, or build a legacy, annuities can play a vital role in your long-term financial strategy.