Annuity

/əˈnjuː.ɪ.ti/

Meaning & Definition

noun

A fixed sum of money paid to someone each year, typically for the rest of their life, in exchange for a capital investment.

He invested in an annuity to ensure a steady income during retirement.

A series of payments made at equal intervals.

The lottery winner chose to receive their winnings as an annuity instead of a lump sum.

A financial product sold by financial institutions that provides a series of payments at specified intervals.

Many people purchase an annuity as a way to manage their retirement savings.

Derived from the Latin 'annuitas', from 'annus', meaning year.

life annuity

An annuity that provides payments for the lifetime of the annuitant.

fixed annuity

An annuity that guarantees a fixed payment amount.

variable annuity

An annuity where payments vary based on investment performance.

pension

A regular payment made to individuals after retirement.

investment

An asset or item acquired for the purpose of generating income.

retirement

The period of life after leaving one's job and ceasing to work.

Money machine

She referred to her annuity as her money machine, bringing in cash every month.

Golden egg

He called his annuity his golden egg that would provide for him in his later years.