Annuity Types Explained

Choose the Right Annuity for Your Retirement Goals

Understanding your options is the first step to securing guaranteed lifetime income. Explore the four main annuity types and discover which one fits your financial needs.

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Compare Annuity Types Side-by-Side

Each annuity type serves a unique purpose in retirement planning. Click on any type below to learn more.

Immediate Income

Single Premium Immediate Annuity (SPIA)

A SPIA converts a lump sum of money into a guaranteed income stream, typically starting immediately or within one year. It is ideal for retirees who want predictable monthly income for life, helping cover essential expenses like housing or healthcare.

Key Benefits:

  • Immediate or near-immediate income payments
  • Guaranteed for life or specified period
  • Predictable monthly cash flow
  • Protection from outliving your savings

Ideal For:

Retirees who need immediate income to cover living expenses and want the peace of mind of guaranteed lifetime payments.

Risk Level:
Very Low Risk
Find Your Annuity Fit
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Most Popular
Growth + Protection

Fixed Indexed Annuity (FIA)

An FIA grows your investment based on the performance of a market index (like the S&P 500) while protecting your principal from market losses. It is suitable for individuals seeking growth potential with safety and tax-deferred compounding.

Key Benefits:

  • Market-linked growth potential
  • Principal protected from market downturns
  • Tax-deferred earnings
  • Optional income riders available

Ideal For:

Pre-retirees and retirees who want growth potential without market risk, and value the balance of safety and upside opportunity.

Risk Level:
Low Risk
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Lifetime Guarantee

Income Annuity

An income annuity provides guaranteed lifetime income in exchange for an upfront premium. It ensures you cannot outlive your retirement savings and can be customized with features such as joint-life payouts or cost-of-living adjustments.

Key Benefits:

  • Guaranteed income for life
  • Protection against longevity risk
  • Customizable payout options
  • Joint-life and inflation protection available

Ideal For:

Retirees who prioritize guaranteed income and want assurance they will never outlive their money, regardless of how long they live.

Risk Level:
Very Low Risk
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Guaranteed Lifetime Payments

Never worry about outliving your savings

Example Scenario:
Investment: $250,000
Age: 65
Monthly Income: $1,400+

For life, guaranteed*

*Rates vary by age, gender, and carrier. This is an illustrative example only.

Maximize Pre-Retirement Growth

Build wealth before you need income

1-5

Years 1-5

Accumulation phase

5-10

Years 5-10

Compound growth phase

Retirement

Convert to income annuity

Accumulation Focus

Growth Annuity

A growth annuity focuses on accumulating wealth before retirement, offering tax-deferred growth with optional guarantees. It is a good choice for pre-retirees who want to maximize savings potential while protecting principal before converting to income later.

Key Benefits:

  • Tax-deferred wealth accumulation
  • Optional minimum guarantees
  • Flexibility to convert to income later
  • Principal protection options

Ideal For:

Pre-retirees (ages 50-65) who want to maximize retirement savings with tax advantages while maintaining flexibility for future income needs.

Risk Level:
Low Risk
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Quick Comparison Guide

Compare all four annuity types at a glance to see which aligns with your retirement goals.

Feature SPIA FIA Income Growth
Immediate Income
Growth Potential Fixed High None High
Principal Protection
Tax-Deferred
Best Timing At Retirement Before/During At Retirement Pre-Retirement
Risk Level Very Low Low Very Low Low

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