Understanding Annuities and Their Purpose

Annuities serve as a strategic financial tool designed to provide a steady income stream during retirement. Immediate annuities require a one-time premium payment, offering guaranteed income for life, while deferred income annuities entail delayed payments that can initiate years after the premium is paid. The concept of longevity insurance is particularly relevant here, as it ensures retirees receive income even into their 90s. By understanding these products, retirees can protect themselves from market volatility and ensure they have adequate funds for their later years.