An annuity is a financial plan to help you build a steady stream of income for retirement, providing financial security when it’s most needed. You contribute either a lump sum or make periodic payments, and in return, you receive consistent payouts—either for a set number of years or for the rest of your life.

Here’s how it works:

• Growth Phase: During this phase, you contribute to your annuity, either all at once or gradually over time, allowing your funds to grow.

• Payout Phase: When you’re ready to receive income, your annuity starts making regular payments, much like a paycheck, ensuring steady income during retirement.

Types of Annuities:

• Fixed Annuities: These provide guaranteed payments, offering predictability and security, making them a good choice if you prefer stable income.

• Variable Annuities: With these, payments vary based on investment performance, offering a chance for higher growth but with associated market risk.

• Indexed Annuities: Tied to a stock market index, these offer growth potential with some protection from market downturns, balancing security with opportunity.