Annuities Annuities are contracts between investors and insurance companies. When you invest for your retirement, you will be interested in deferred annuities, which shelter the interest you earn on your investment much as an IRA does. Unlike IRA's, though, you generally can't buy annuities with pre-tax money. There are two kinds of deferred annuities, fixed annuities and variable annuities. Fixed annuities credit your account with interest based on a fixed rate that you agree to when you open your account.
Variable annuities contain investment pools much like mutual funds.
You choose which of the funds within your annuity your money goes to, and you earn interest based on the performance of the funds. Social Security One of the most vexing issues in retirement planning is Social Security. Many people don't have a clear picture of how much income they are eligible for from Social Security, and when they should apply for it. Others have little confidence in the Social Security system and predict its imminent failure. There are, in fact, a number of uncertainties present in the system.