A Quick Annuity Definition

Definition of an Annuity

The most basic annuity definition is that it is an insurance product that makes future payments on an initial invested capital or series of contributions over time. Annuities are typically used as part of a retirement income strategy but can be employed in other investment plans as well. Your initial capital and contributions made into your annuity are allowed to appreciate without being subjected to tax; however, the payments you receive from your annuity will be taxed.

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