What is an annuity income?

An annuity income is comprised of two components as follows: The “yield” for an annuity income will always be a higher than that from fixed interest rates alone. This is because it includes a “return of capital” over the annuitant’s expected lifetime. Correspondingly, an annuity ceases on death whereas fixed interest investments do not.

How much do annuities pay?

The amount you’re paid by an annuity mostly depends on how much money you’re willing to put towards buying it. The more you invest, the more you’ll get in return. Those payments will continue for either an agreed term (known as a fixed term annuity) or for as long as you live (known as a lifetime annuity).

What is a lifetime annuity?

Lifetime annuities provide an income for the life of the annuitant. An annuity income is comprised of two components as follows: The “yield” for an annuity income will always be a higher than that from fixed interest rates alone. This is because it includes a “return of capital” over the annuitant’s expected lifetime.