An annuity is a contract between you and an insurance company for a financial product that provides a steady income during retirement. The amount and duration of your payments are typically based on your life expectancy.   Types of Annuities The three main types of annuities include: Fixed:  A fixed annuity  provides a guaranteed payout regardless of market conditions. An investor desiring a predictable income during retirement favors this type of annuity. Variable:  A varia

A variable annuity is a type of insurance contract that combines investment with retirement income protection. Because the contract is invested in subaccounts tied to underlying investments, such as stocks, bonds, and mutual funds, it can offer higher returns than fixed annuities.   A variable annuity might be a good option if you want to stay ahead of inflation and increase the value of your retirement savings. The following information can help determine whether one might b