An annuity is a contract with an insurance company: you put money in, and in return you receive income, either starting right away or at a date you choose. The core promise is longevity protection — the income keeps coming no matter how long you live.
Fixed annuities pay a guaranteed interest rate and protect your principal. They behave a lot like a certificate of deposit, but often with more competitive rates and tax-deferred growth.
Fixed indexed annuities add growth potential linked to a market index, such as the S&P 500, while shielding you from market losses. When the index rises, your interest credit follows (up to a cap); when it falls, you simply earn zero for that period instead of losing money.
The most important decision isn't which product — it's the income plan. When will you start taking income, how much will you need each month, and which accounts should feed it? That plan should come before any product recommendation.
If your biggest retirement worry is running out of money, that's precisely the problem annuities were designed to solve. We're happy to walk through the trade-offs with real numbers in a free consultation.