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Glossary

Annuity

A financial product that pays a stream of income.

An annuity converts a lump sum into regular payments, either for a fixed period or for life. Immediate annuities start paying right away; deferred ones grow first.

The payout depends on the amount, the interest rate, the payout period, and — for lifetime annuities — mortality assumptions and insurer fees.

Put it into practiceTry the Annuity Payout CalculatorRun your own numbers in seconds — free and private.

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