How Are Annuities Different From Mutual Funds? 
Mutual Funds are securities tied to the stock market . They are subject to the gains and losses of the market more directly than an annuity . An Indexed annuity is tied to stock indexes but they are much safer than a mutual fund in that you are protected from the losses of the market . Since you have that protection , you will generally not have the gains of the stock market . Annuities are safe money and a good way to provide for an retirement without the risk . Mutual Funds and stocks have more risk but greater gain potential . Which is better for you depends on your personal situation , goals , and risk tolerance . 