Pros of investing in an annuity include the guaranteed stream of income that can provide a stable source of retirement income, the ability to defer taxes on any gains until withdrawals are made, and protection against market risk. Cons of investing in an annuity include potential surrender fees and penalties for withdrawing funds before the end of the contract term, the potential for high fees and expenses, and the potential for inflation to erode the purchasing power of the annuity payments over time.