What Are Annuities? 
It is important to note that the previous answer is specific to Immediate Annuities . More specifically Lifetime Immediate Annuities . There is also another popular form of Annuity called a Deferred Annuity . These actually will grow your funds , usually at a set interest rate , until you decide to either move the funds or to take income from them . If you decide to take income from it , you may do so the same way as an Immediate Annuity . You can choose a Lifetime Payout , a Lifetime Payout with Beneficiary Options , or a payout for a specific number of years . In short , an Annuity is a retirement savings tool that allows you to grow your money or to create an income stream from your money . 