Annuities Made Simple Great investment so misunderstood. This page will summarize the most important features of annuities and give you links to more information. For more information on these topics, check the box on the right. While they re saving for retirement they buy annuities to defer taxes perhaps enabling them to save more than with taxable investments such as mutual funds.
Annuities are especially appropriate as a long-term investment alternative to mutual funds.
Once you retire, an annuity can generate monthly income as long as you live. With life expectancies increasing and the length of retirement growing, income for life can be a very attractive feature. The distinction between fixed and variable annuities is one that often confuses investors. Fixed annuities are often associated with the payout stage, and variable annuities are more often associated with the savings or accumulation phase. However, both types of annuities may be used to save for retirement, and both types may be used to generate monthly payments once you retire.