Annuities are a smart way to secure your financial future, offering a steady income that can last for years, especially in retirement. An annuity is an agreement with an insurance company where you make a payment now and, in return, receive guaranteed income later. This can relieve the stress of wondering how you’ll manage your finances once you’re no longer working. An annuity helps provide peace of mind by ensuring you don’t have to worry about running out of money.

There are a few different annuities, each designed with a distinct purpose. You can choose between immediate and deferred annuities. An immediate annuity kicks in right after you pay, offering income right when needed. It’s a great option if you’re close to retirement or have already retired and need consistent income immediately. On the other hand, a deferred annuity lets you invest your money and allow it to grow for a period before payouts begin. This is perfect if you’re planning for the future and want to build up savings now, knowing that income will start later.

These two types have further variations depending on how your investment grows. Fixed annuities offer a stable, guaranteed return, so you’ll always know what to expect. This option is excellent for people who want security without worrying about market fluctuations. Variable annuities, however, are linked to market investments, so there’s potential for higher returns—but there’s also some risk involved. Then, there are indexed annuities, which offer a mix of both. They tie your returns to a market index but protect you from market losses with a set floor, allowing for growth with some built-in protection.

Annuities provide income security and tax advantages and can even be used for legacy planning. Many annuities offer guaranteed payouts for life, which can help cover daily living expenses, healthcare, or even vacations during retirement. Plus, with deferred annuities, your funds grow tax-deferred, so you don’t pay taxes until you withdraw them, giving your investment more time to develop. Some annuities also allow you to leave benefits to your loved ones, creating a financial legacy that supports your dreams and those of your family.

At their best, annuities help you transform thoughtful planning into lasting security. They’re not just about building wealth; they’re about ensuring that you have the freedom to enjoy your life, explore new opportunities, and spend time with family, knowing that your financial foundation is solid.