The term “annuity” refers to an insurance contract issued and distributed by financial institutions with the intention of paying out invested funds in a fixed income stream in the future. Investors invest in or purchase annuities with monthly premiums or lump-sum payments. The holding institution issues a stream of payments in the future for a specified period of time or for the remainder of the annuitant’s life. Annuities are mainly used for retirement purposes and help individuals address the risk of outliving their savings.

Merriam-Webster Online Dictionary
annuity (noun)
1.
a sum of money payable yearly or at other regular intervals
2.
the right to receive an annuity
3.
a contract or agreement providing for the payment of an annuity
Merriam-Webster Online Thesaurus
annuity (noun)
a sum of money allotted for a specific use by official or formal action
SYNONYMS:
allocation, allotment, annuity, entitlement, grant, subsidy, subvention
RELATED WORDS:
aid, assistance, block grant, grant-in-aid, set-aside; foreign aid, relief, state aid; advance, allowance, benefit, bequest, endowment, fund, legacy, stipend, trust, trust fund
annuity
Synonyms:
Invested Funds
Categories: Income